Domestic and international bullion prices ticked upward on Wednesday morning, recovering from Tuesday’s sharp losses. The modest rally is driven by a softening US dollar, though trading remains heavily cautious as market participants keep a close eye on volatile US-Iran peace negotiations and critical upcoming US economic data.

• MCX Gold Futures (June 2026): Up Rs. 215 to Rs.1,57,898 per 10 grams. MCX Silver Futures (July 2026): Up Rs. 2,000 (0.7%) to Rs. 2,72,628 per kg. Spot Gold: Rose 0.2% to $4,516.76 per ounce. Spot Silver: Gained 0.6% to $77.40 per ounce.

The morning’s gains follow a brutal Tuesday session in the national capital, where retail gold prices tumbled by Rs. 2,800 to Rs. 1,62,400 per 10 grams (inclusive of all taxes), down from Monday’s closing of Rs. 1,65,200. Analysts note that escalating military friction earlier in the week pushed safe-haven capital into the US dollar, temporarily depressing non-yielding bullion.

While investors are tracking volatile crude oil prices and Treasury yields, the US-Iran conflict remains front and center:

• Military Friction: Cautious sentiment persists following “defensive” US strikes on Iranian missile sites near the Strait of Hormuz and subsequent Iranian retailatory fire. Iran accused the US of breaching an active ceasefire.
• Peace Framework: Despite weekend optimism surrounding a framework peace deal, US official Marco Rubio indicated that finalizing an agreement to halt hostilities and reopen the Strait of Hormuz could still take “a few days.”

Bullion’s upside momentum faces headwinds from global monetary policy uncertainty. Higher energy costs have fueled sticky inflation concerns, leading markets to price in a near 40% probability of a US Federal Reserve rate hike by December. Highlighting these persistent macroeconomic pressures, banking giant UBS reduced its year-end gold price target by $400 to $5,500.