Precious metals edged higher in international markets as an equities selloff and intensifying geopolitical turmoil in the Middle East steered capital into safe-haven assets. The broader flight to safety prompted sharp declines in government bond yields, lowering the opportunity cost of holding non-yielding bullion. Spot gold traded cautiously higher, gaining 0.3% to hover around $4,170 per ounce. Meanwhile, silver decisively outperformed the yellow metal, surging over 1% to hold comfortably above the key $57 per ounce threshold.
Silver Surges 1.11% to Approach $57.6 Per Ounce
Spot silver demonstrated strong upward momentum on Friday, rallying 1.11% to trade near $57.6 per ounce. The white metal held firm above $57 per ounce, extending its rebound from the previous trading session. The rally followed a broader pullback across equity markets, which prompted portfolio managers and institutional investors to shift allocations toward government debt and precious metals. Silver benefited directly from this renewed appetite for defensive positioning across global commodity exchanges.
Gold Stays Resilient Above $4,170 as Yields Retreat
Spot gold edged up marginally by 0.3% to trade around $4,170 per ounce. A key catalyst supporting the yellow metal has been the sharp drop in government bond yields, which reduced pressure on non-yielding commodities. The broader commodity landscape also saw weakness in energy markets, with crude oil benchmarks sliding by 0.5% to 1%. US WTI crude traded near $97 per barrel, while global benchmark Brent crude hovered around $105 per barrel, slightly softening headline inflationary pressures while underscoring broader economic uncertainty.
Middle East Escalation and Strait of Hormuz Incident Lift Risk Premiums
Geopolitical instability in the Middle East remained a primary driver behind the safe-haven bid. Market participants closely monitored escalating hostilities between Saudi Arabia and Iran-backed Houthi forces in Yemen. Adding to maritime and supply chain concerns, a Singapore-flagged container ship was sunk in the Strait of Hormuz this week after being struck by an Iranian projectile. The naval strike along one of the world's most critical shipping choke points has elevated risk premiums across commodities and injected fresh caution into financial markets.
All Eyes on Fed Chair Kevin Warsh and Month-End Policy Decision
Market direction in the near term will hinge heavily on United States central bank communications and monetary policy guidance. Jateen Trivedi, VP Research Analyst for Commodity and Currency at LKP Securities, noted that an upcoming speech by US Federal Reserve Chair Kevin Warsh and the Fed's month-end interest rate decision will serve as pivotal catalysts. These events are expected to heavily influence the direction of the US dollar, recalibrate interest-rate expectations, and dictate the trajectory of bullion prices on global exchanges as well as domestic trading on the Multi Commodity Exchange.
