Gold prices rallied on Monday as investors rushed to safe-haven assets following major military strikes by the United States and Israel on Iran, escalating geopolitical tensions and heightening global economic uncertainty.
Spot gold rose 1% to $5,329.39 an ounce as of 0201 GMT, after touching its highest level in more than four weeks. Earlier in the session, bullion climbed as much as 2%. US gold futures advanced 1.8% to $5,342.80 per ounce.
The renewed rally came after Israel launched a fresh wave of strikes on Tehran on Sunday, prompting retaliatory missile fire from Iran. The developments followed reports of the killing of Iran’s Supreme Leader, Ali Khamenei, a move that has significantly intensified instability across the Middle East and rattled global markets.
Analysts said the scale of escalation has strengthened gold’s appeal as a hedge against risk. “There is strong incentive for both sides to continue escalating, raising the risk of prolonged volatility,” said Kyle Rodda, senior financial market analyst at Capital.com, adding that the outlook for gold remains positive amid sustained uncertainty.
Bullion, traditionally viewed as a safe-haven investment during geopolitical crises and inflationary periods, has repeatedly hit record highs this year. Prices have surged 64% in 2025, supported by aggressive central bank purchases, strong inflows into exchange-traded funds (ETFs) and expectations of US monetary policy easing.
Major financial institutions, including JPMorgan Chase and Bank of America, recently reiterated forecasts that gold could approach the key $6,000 level. JPMorgan projected that sustained central bank and investor demand could push prices toward $6,300 per ounce by the end of 2026.
Meanwhile, recent US data showed producer prices rose more than expected in January, signaling potential inflationary pressure ahead. Investors are now closely watching upcoming US labor market indicators, including the ADP employment report, weekly jobless claims and the non-farm payrolls report, for further signals on economic direction.
In other precious metals, spot silver slipped 1.2% to $92.72 an ounce despite posting monthly gains in February. Platinum fell nearly 1% to $2,343.50, while palladium edged up 0.5% to $1,795.11 per ounce.
The sharp move in gold underscores how geopolitical shocks in the Middle East continue to drive volatility in global financial markets and commodity prices.
