Gold rises 2% after the US-Israeli strikes on Iran

Gold prices jumped by about 3 percent in Monday trading, driven by the escalation of geopolitical tensions in the Middle East following massive US-Israeli strikes on Iran, and subsequent Iranian missile responses, which deepened the state of uncertainty in global markets.

Gold in spot transactions recorded an increase of 2.3 percent to $5,400.85 per ounce, which is its highest level in more than four weeks, and US gold futures contracts rose by 2.97 percent to $5,403.60.

An unprecedented escalation enhances the demand for safe havens

Recent military developments, including the killing of Iranian Supreme Leader Ayatollah Ali Khamenei, have raised the level of geopolitical risks, and this has prompted investors to hedge with traditional safe assets, most notably gold.

Analysts believe that continued escalation raises the possibility of extended volatility in the markets, giving gold additional momentum in the near term.

Extended upward momentum since the beginning of the year

The recent rise comes within a strong upward trajectory, as gold has recorded gains of about 64 percent since the beginning of 2025, supported by strong purchases from central banks, and remarkable inflows into exchange-traded funds, in addition to expectations of an easing of US monetary policy.

Major financial institutions, including JP Morgan and Bank of America, recently indicated the possibility of gold rising towards the $6,000 level, while JPMorgan expects it to reach $6,300 per ounce by the end of 2026, supported by investment demand and central bank purchases.

US inflation data adds support

On the other hand, recent data showed that producer prices in the United States rose more than expected during January, which reinforces fears of possible inflationary pressures and increases the attractiveness of gold as a hedging tool.

Other precious metals

The rise was not limited to gold, as silver rose by 1.68 percent to $95.35 per ounce, platinum increased 0.74 percent to $2,382.15, and palladium rose 0.25 percent to $1,790.60, in light of a general trend toward assets associated with hedging risks.