Gold Prices Drop Over Rs 14000 As Israel-Iran Ceasefire Reduces Safe-Haven Demand

Gold prices saw a sharp decline on Tuesday across both domestic and international markets, reacting to global cues after U.S. President Donald Trump announced a ceasefire between Israel and Iran. The easing of geopolitical tensions reduced demand for traditional safe-haven assets like gold and silver.

The drop in gold prices is expected to bring relief to jewellery buyers and retail shoppers who have been waiting to make their purchases. Although rates have fallen, gold prices remain near their all-time high.

Gold Prices in India:

The price of 24-carat gold dropped by Rs 1,470, to Rs 99,220 per 10 grams. The rate per gram also decreased by Rs 147, bringing it to Rs 9,922 for pure gold. Similarly, 22-carat gold prices fell by Rs 1350 to Rs 90,950 per 10 grams, with the per-gram price now at Rs 9,095, down Rs 135. Also, the18-carat yellow metal prices fell by Rs 1,100 per 10 grams to Rs 74,420, with the per-gram rate now at Rs 7,442, down by Rs. 110.

Meanwhile, 100 grams of gold is available at Rs 9,92,200 in 24 carat, registering a downfall of Rs 14,200. Also, 22 carat and 18 carat gold prices are at Rs 9,09,500 and Rs 7,44,200, down by Rs 13,500 and Rs 1,100, respectively.

Gold Price on MCX:

By 3.25 pm, gold on Multi Commodity Exchange (MCX) was trading at Rs 97,100, down Rs 2,288 or about 2.30%. Silver was also in the red, falling by Rs 1,134 or 1.06%, trading at Rs 1,05,625 per kg.

The MCX gold rate began the day down 0.58%, opening at Rs 98,807 per 10 grams compared to the previous close of Rs 99,388. Prices fell further in early trading, reaching an intraday low of Rs 96,422 - a nearly 3% decline. Silver prices also started on a lower note at Rs 1,06,502 per kg, down from Rs 1,06,759, and later touched Rs 1,05,505.

Global Gold Price:

Internationally, gold touched a near two-week low. Spot gold fell 1.48% to $3,318.95 per ounce at 3.25 PM (IST), after hitting its lowest since June 11 earlier in the session. U.S. gold futures were down 1.8% at $3,333.80. Silver was slightly weaker, with spot prices dipping 0.1% to $36.06 an ounce.

What Led to the Fall in Gold Price?

President Trump declared a "Complete and Total Ceasefire" between Israel and Iran, signaling an end to what he described as a "12-Day War." While Iranian officials have indicated agreement on a ceasefire, some statements from Tehran suggest it hinges on a halt to Israeli military actions.

As a result, gold prices dropped today. Trump said that both countries had agreed to stop fighting, and following this news, global gold prices fell to their lowest level in two weeks.

"Gold prices fell below $3,350 per ounce on Tuesday as safe-haven demand weakened following President Trump's announcement of a ceasefire between Israel and Iran. The de-escalation, paired with Iran's minimal retaliation and avoidance of major conflict zones, reassured markets," Kedia Advisory noted in its report.

"Gold prices weakened as the geopolitical tension eased following ceasefire developments, reducing investor interest in safe-haven assets. Market attention is now shifting toward Federal Reserve Chair Jerome Powell's upcoming testimony before the U.S. Congress for policy signals," said Jigar Trivedi, Senior Research Analyst at Reliance Securities.

Meanwhile, Federal Reserve Vice Chair Michelle Bowman indicated that interest rate cuts might soon be warranted due to emerging risks in the labor market. Powell is expected to address the House Financial Services Committee later in the day.

Gold Price Outlook:

In the near term outlook, gold prices may face resistance. "Gold prices below 3300$ looks towards 3270$-3220$ levels while on MCX Support will be 96800 and below same can test 96000 followed by 95400 levels," says Ajay Kedia, Director of Kedia Advisory.

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