Written by Escalating tensions between India and Pakistan have sent ripples through the precious metals market, with gold and silver prices experiencing dramatic swings over the past week. Following India’s Operation Sindoor against terrorist infrastructure in Pakistan and retaliatory attempts by Pakistan using drones and missiles, investors have flocked to safe-haven assets, causing gold prices to soar past the ₹1 lakh per 10-gram mark in the national capital.
On Wednesday, gold of 99.9% purity surged by ₹1,000 to reach ₹1,00,750 per 10 grams, while silver mirrored the upward momentum, climbing to ₹98,940 per kilogram. The surge was largely attributed to heightened geopolitical uncertainty, as investors sought refuge from potential market volatility. “Gold is a cozy blanket during a storm. Whenever the world sees unrest, it is natural tendency for gold prices to go up being a safer asset,” said N.S. Ramaswamy, Head of Commodity Desk at Ventura.
However, the rally was short-lived. By Friday, gold prices had sharply corrected, plunging by ₹12,500 per 100 grams for 24K gold, as immediate war fears eased and global risk sentiment improved. The broader range for gold is now seen between ₹95,000 and ₹98,000 per 10 grams, with further moves hinging on the evolving geopolitical landscape and currency fluctuations. A weaker rupee, often a byproduct of such tensions, could cushion domestic gold prices even if global rates decline.
Silver, too, tracked gold’s volatility, with prices fluctuating in tandem with investor sentiment and global cues. As the situation remains fluid, analysts caution that any escalation could reignite safe-haven demand, pushing gold and silver higher once again. For now, the market remains on edge, closely watching both the border and global financial developments.