BANGKOK, THAILAND – Gold prices on global markets climbed to new heights as investors sought a traditional safe haven amid escalating violence in the Middle East, while a stronger US dollar made the metal more expensive for buyers in other currencies without stopping the rally.
Gold rally under the shadow of conflict
The spot price of gold on the New York market rose 0.4 percent on 2 March to US$5,297.31 per ounce, after briefly jumping by more than 2 percent in the previous session. The metal had already set a record high of about US$5,594.82 on 29 January and had since held near that elevated level.
New US and Israeli airstrikes on Iran, followed by Iranian retaliation and attacks on other Arab states, triggered the latest price moves. The aerial campaign widened on Monday when Israel struck targets in Lebanon after attacks by the Shiite militia Hezbollah, while Tehran continued firing rockets and drones at Gulf states.
Markets navigate crisis mode
US gold futures closed on Monday 1.2 percent higher at US$5,311.60, while the US dollar index gained 1 percent, making gold more expensive for non-dollar investors. Despite this, demand for the metal as a safe haven continued to underpin prices.
“The market is currently trying to assess whether there will be further attacks in the coming weeks,”
said David Meger, head of metals trading at High Ridge Futures.
He added that
“this uncertainty is likely to support prices.”
said David Meger, head of metals trading at High Ridge Futures.
Oil shock and central banks as buyers
The attacks forced shutdowns of oil and gas facilities in the region and disrupted shipping through the strategically important Strait of Hormuz, pushing oil and gas prices sharply higher. Analysts said the surge in energy costs added to the appeal of gold as a hedge in a period of geopolitical strain.
Analysts at SP Angel said that rising geopolitical fragmentation had prompted central banks from BRIC countries to cut their holdings of dollar-denominated assets and increase their gold reserves. They expected this trend to continue in the coming period.
Record chase and investment flows
Gold had gained almost 25 percent in value since the start of the year, following a strong rise of 64 percent in 2025, supported by heavy central bank purchases, robust inflows into ETFs and a looser US monetary policy. These factors helped sustain the multi-year uptrend in the metal.
Bank BNP Paribas said investor demand for physical gold was likely to remain a key price driver this year. It added that this demand had given additional momentum to the long-running upward trend.
Asian morning trade and data watch
On Tuesday morning in Singapore, the spot price rose another 0.4 percent to US$5,342.99, according to Bloomberg, while silver, platinum and palladium also advanced. Gold thus extended gains for a fifth consecutive trading day.
The metal stayed above US$5,340 at the start of Asian trading, after closing 0.8 percent higher in the previous session. The simultaneous rise in other precious metals suggested broader buying interest across the complex.
Dollar moves, rates and inflation fears
The Bloomberg Dollar Spot Index slipped 0.1 percent on Tuesday morning, after having closed 0.7 percent higher the previous day, leaving the usual headwinds for gold only partly in force. The slight easing in the dollar provided some relief to non-US buyers of the metal.
The jump in oil and gas prices stoked inflation concerns in the United States and pushed down prices of US Treasuries. This increased the likelihood that the Federal Reserve would leave its policy rate unchanged for longer, with investors now pricing in an interest rate cut only by September.
Trump’s threats and shifting rate expectations
US President Donald Trump announced on Monday a “large wave” of further attacks and said military operations against Iran would continue as long as necessary. His comments reinforced expectations of prolonged tensions in the region.
While Iran attacked oil and gas infrastructure and threatened shipping in the region, the prospect of extended hostilities further strengthened gold’s role as a store of value and safe haven. This came even though higher interest rates usually weigh on the non-yielding metal.
Impact on trade and other metals
Three industry sources said gold flows into and out of the trading hub Dubai were likely to drop sharply in the coming days. Airlines were cancelling numerous flights because of the conflict, curbing physical movement of bullion.
Market participants were also watching this week’s US data calendar, including the ADP employment report, weekly initial jobless claims and the official non-farm payrolls report. These figures were seen as crucial for the outlook on US growth and interest rates.
Silver, platinum and palladium under pressure and recovery
While gold hovered near record levels, spot silver initially fell 5.7 percent on Monday to US$88.46 per ounce, after previously reaching its highest level since 30 January. The drop highlighted volatility across precious metals amid shifting risk sentiment.
On Tuesday morning, however, silver turned higher again and rose 0.6 percent to US$89.87, according to Bloomberg, while platinum and palladium also gained in late Monday trading and at the start of Asian trading. The rebound suggested that investors were returning to other precious metals alongside gold.