- By Aditya Pratap Singh
- Wed, 11 Mar 2026 06:52 PM (IST)
- Source:JND
Historically, the gold price skyrocketed during periods of global uncertainty, with common citizens, institutional investors, and governments typically rushing to buy the yellow metal as a safe-haven asset during wars, geopolitical tensions, or major trade disruptions. However, the ongoing conflict in the Middle East has so far gone against that pattern. Despite a full-scale war that has continued for over 10 days, disrupting daily activities across a dozen countries and threatening a significant portion of global energy supply, gold prices in India have largely remained range-bound between Rs 1.55 lakh and Rs 1.65 lakh per 10 grams.
In fact, the scenario is flipped to all the price spur speculations, when tension was escalating between the US, Israel, and Iran in late February before the war began. The majority of analysts had anticipated a sharp uptick in the price of yellow metal, and several traders had speculated that gold could breach the psychological Rs 2 lakh per 10-gram mark in the domestic market, surpassing its previous all-time high of around Rs 1.93 lakh on the Multi Commodity Exchange (MCX).
Moreover, Silver, which often mirrors gold’s safe-haven footprint during global events, did not see any meaningful price surge either. Meanwhile, the muted reaction of both precious metals with respect to the current unprecedented geopolitical situation has raised questions among market participants about what is holding back the traditional safe-haven rally.
Why Gold Price Did Not Skyrocket Despite War In Middle East?
While the commodity market's current behaviour seems confusing for many participants, Kaveri More, Commodity Analyst at Choice Broking, said that despite escalating geopolitical tensions in the Middle East, bullion prices have struggled to rally as traditional safe-haven demand is being offset by strong macro headwinds.
“Rising market volatility, reflected in elevated VIX levels and a global equity sell-off driven by higher oil prices and currency weakness, has increased liquidity demand rather than outright gold buying. At the same time, fading expectations of near-term US Federal Reserve rate cuts, with markets pricing a high probability of steady rates, have supported bond yields and the dollar, reducing gold’s appeal,” More stated.
She further emphasised that Investor sentiment has also softened as ETF inflows moderated, central-bank gold purchases slowed compared to last year’s average pace, and exchanges adjusted margin requirements amid heightened volatility, prompting position unwinding.
Highlighting some factors holding back the gold rally, Jateen Trivedi, VP Research Analyst - Commodity and Currency, LKP Securities, noted that while geopolitical risk typically supports bullion, the sharp rise in crude oil and energy prices is increasing global inflation concerns.
Also Read: US-Iran-Israel War Impact: IOC, BPCL, HPCL Could See Margin Pressure Amid Oil Price Spike, Says S&P
“This, in turn, could delay interest rate cuts by the Federal Reserve, which strengthens the U.S. dollar and limits aggressive buying in gold. As a result, gold is currently balancing between safe-haven demand and tighter monetary policy expectations. As long as the conflict continues and energy prices remain volatile, bullion is likely to trade in a broad range rather than in a one-way rally,” Trivedi added.
Hareesh V, Head of Commodity Research, Geojit Investments Limited, believes gold isn’t rallying despite the West Asia crisis because strong U.S. yields, a firm dollar, and expectations of delayed Fed rate cuts are offsetting safe‑haven demand.
Investors are waiting for clearer signals of escalation or policy easing, and ETF outflows and profit‑booking after earlier highs are also capping the upside.
Gold Price Outlook–Could Gold Hit the Rs 2 lakh Mark
The analysts are convinced of gold’s bullish momentum amid heightening geopolitical situations that are weighing on the energy crisis and major trade disruption of goods and services to and from a particular area–the Middle East. However, they don’t see gold prices breaching the Rs 2 lakh level in the near future.
“Gold remains structurally bullish in the medium term, supported by central-bank buying and geopolitical uncertainty, with major banks projecting further upside through 2026, and if prices sustain above Rs 170,000, momentum could rebuild toward Rs 180,000 with a longer-term possibility of testing Rs 2 lakh, while key supports are seen near Rs 150,000–Rs 136,000,” said Kaveri More.
“Rs 2,00,000 is possible but not immediately — it is more of a medium- to long-term projection,” Jateen Trivedi emphasised.
According to Trivedi, in the domestic market, MCX gold may trade between Rs 1,55,000 and Rs 1,65,000 during the ongoing war phase.
Silver Price Outlook
The commodity market experts see more volatility in silver as compared to gold during the war phase due to its exposure to industries.
“With inflation risks rising due to higher crude and gas prices and potential supply disruptions through the Strait of Hormuz, silver may fluctuate in a $78–$92 range globally, while MCX silver could trade between Rs 2,45,000 and Rs 2,95,000 during the conflict period,” Trivedi predicted.
According to More, during the war phase, silver is expected to outperform gold on a percentage basis, supported by industrial demand and tightening supplies with upward bias as the metal enters a broader price-discovery phase, with support around Rs 253,500–Rs 225,800, and potential upside toward Rs 300,000. Sustained strength above this zone could trigger the next broader bull run.