SINGAPORE, SINGAPORE – Gold surged as a weaker US dollar and hopes of easing inflation pressure drove robust gains in the precious metals market.
Gold rally on 10 March
Spot gold prices jumped by 1.9 percent to 5,231.79 US dollars per ounce, according to Reuters. US gold futures for April on the futures exchange rose even more sharply, climbing 2.7 percent to 5,242.10 US dollars.
The moves underscored renewed demand for the metal as investors repositioned around shifting expectations for inflation and monetary policy. The gains came despite ongoing uncertainty over the conflict in the Middle East.
Weaker dollar makes gold more attractive
A softer US dollar index supported the market, making dollar-priced gold cheaper for buyers holding euros, Swiss francs or Thai baht. In periods of currency volatility, capital often moved into precious metals because they were seen as a store of value.
This dynamic increased the appeal of gold globally, even as broader financial markets continued to track geopolitical risks and central bank signals.
Oil drop eases inflation fears
Oil prices fell on 10 March after having reached their highest level in more than three years the previous day. The pullback was triggered by expectations that the war in the Middle East could end earlier than feared, easing concerns about prolonged supply disruptions.
The decline in crude reduced some of the immediate pressure on inflation that had worried markets. That, in turn, supported assets seen as hedges against longer-term price and currency risks.
Conflict situation unclear amid reports of heavy strikes
Despite the market reaction, conditions on the ground showed no clear signs of de-escalation, according to Reuters. People in Tehran contacted by the agency reported heavy nighttime airstrikes on the capital by US and Israeli forces.
They said the attacks were among the most intense since the start of the conflict, highlighting the gap between market optimism and the unresolved security situation.
Fed in focus as oil loses power to block cuts
Strategist Bart Melek of TD Securities said that, after crude oil had retreated from highs above 100 US dollars per barrel, it was no longer a major obstacle to potential interest rate cuts by the US Federal Reserve.
“It is no longer high enough to seriously limit the Fed’s ability to cut rates,”
said Bart Melek, strategist at TD Securities.
With that shift, investors were more inclined to bet that monetary easing and concerns about loss of purchasing power could support gold. Rising interest rates normally hurt the non-yielding metal, but expectations of stable or lower rates tended to favour it.
Markets await CPI and PCE ahead of Fed decision
Markets turned their attention to US consumer price index (CPI) data and PCE inflation figures expected later in the week. These indicators were regarded as critical for the Federal Reserve’s policy outlook.
For the Fed meeting scheduled for 17–18 March, it was widely expected that interest rates would be left unchanged. That stance kept focus on how soon any future rate cuts might begin and how strongly they could influence gold.
Dubai discount as flight curbs trap metal
In Dubai, gold reportedly traded at a discount to London prices. Flight restrictions linked to the conflict left part of the metal effectively trapped in the local market.
At the same time, demand in Dubai remained subdued, putting additional downward pressure on local prices despite the global rally.
Silver, platinum and palladium swing
On 10 March, spot silver rose 2.7 percent to 89.39 US dollars, while platinum gained 2.2 percent to 2,229.15 US dollars. In contrast, palladium slipped 0.9 percent to 1,675.50 US dollars per ounce.
The divergent moves highlighted differing supply-and-demand dynamics across the precious metals complex, even as gold set the tone for the sector.
Hormuz confusion sends oil back up
Gold held near 5,190 US dollars as investors digested conflicting statements from US officials on the Middle East war, which drove sharp swings in energy prices. The White House stated that the United States would not escort oil tankers through the Strait of Hormuz.
That statement contradicted a later deleted social media post by Energy Minister Chris Wright, after which oil prices rebounded from Tuesday’s sharp drop, adding another layer of volatility to markets closely linked to geopolitical risk.