Gold prices fell on Wednesday, April 15, with futures trading on the Multi Commodity Exchange slipping by ₹353, or 0.23%, to ₹1,54,464 per 10 grams for June delivery, due to lower demand in the spot market. The contract recorded a trading volume of 1,699 lots.
This drop followed a rise in which had reached a one-month peak earlier in the session, as the prospect of renewed peace negotiations between the United States and Iran enhanced investors’ risk appetite.
In the international market today, spot gold slipped 0.6% to $4,811.19 per ounce, while US gold futures for June delivery fell 0.3% to $4,834.40. Sentiment was also influenced by rising oil prices, which heightened inflation concerns.
Meanwhile, US President indicated that talks to end the Iran conflict could resume in Pakistan over the next two days following the breakdown of weekend negotiations.
Saumil Gandhi, Senior Analyst – Commodities at HDFC Securities, highlighted that since the escalation of conflict in West Asia at the end of February, gold has shown sustained weakness, declining consistently on a weekly basis. Since its recent peak on March 2, spot gold has been corrected by around 10%.
While gold is traditionally viewed as a safe-haven asset during geopolitical tensions, its recent price action has diverged due to a shift in the broader macroeconomic environment.
Spot gold has declined by more than 10% since the onset of the US-Israel conflict with Iran on February 28. This week, bullion has increased by 1.3% thus far.
Mohit Gulati, CIO and managing partner of ITI Growth Opportunities Fund, said that gold’s pullback isn’t a contradiction; it’s a correction. Gulati believes that geopolitics creates headlines. Macro fundamentals create price. Right now, the fundamentals are winning.
“But zoom out. Every reserve currency in world history — the Dutch guilder, the British pound, the Roman denarius — has eventually fallen. Gold has outlasted them all. This dip doesn’t change my view. I am, and remain, a long-term bull,” added Gulati.
Key reasons why gold prices are falling amid geopolitical tensions
Experts believe gold’s decline, despite geopolitical tensions, stems from below interconnected forces.
Higher interest rates weigh on gold
Higher interest rates generally exert downward pressure on gold since it does not provide any yield, making interest-generating assets such as bonds and cash more appealing.
Stronger US dollar adds pressure
Simultaneously, a stronger adds extra strain on gold prices as it becomes pricier for those purchasing in other currencies, which reduces demand. According to Gulati, despite the geopolitical noise, a resilient dollar making gold expensive for foreign buyers.
Hareesh V, Head of Commodity Research, Geojit investments Ltd also believes that a stronger US dollar has made gold costlier for overseas buyers
Rising bond yields increase competition
Increasing bond yields further intensify competition by offering more attractive returns on fixed-income investments, leading to a move away from non-yielding assets like gold.
Gulati explained that rising real yields in the US offering actual returns, something gold simply can’t compete with; markets beginning to price in de-escalation, unwinding the safe-haven premium that drove the rally; institutional players booking profits after a sharp run-up — classic sell-the-news behavior; and ETF outflows signaling fading conviction among both retail and institutional holders.
Liquidity needs trigger selling
During times of market distress, investors may also liquidate gold to secure liquidity, realize profits, or fulfill margin calls, resulting in temporary price drops.
Hareesh V of Geojit investments, noted that profit-taking after the 2025 rally to record highs triggered momentum-driven selling, compounded by liquidity shifts and central bank reserve adjustments that pressured demand.
Conflict already priced in
Furthermore, if gold has already surged due to , prices may adjust downward as markets re-evaluate risks and investors solidify their profits.
Hareesh added that technical corrections after last year’s parabolic rise saw breakdowns below key support levels, accelerating losses.
Further, Saumil Gandhi of HDFC Securities, opined that looking ahead, if geopolitical tensions persist, market focus may gradually shift toward global growth risks or the potential for recession, which could bolster safe-haven demand for gold in the long term. However, in the short term, gold remains highly sensitive to fluctuations in crude oil, exhibiting a notable inverse relationship.
According to Gandhi, a continued decline in oil prices could support further gains in gold, while any rebound in crude oil may exert downward pressure on the metal.
Technical Outlook
Saumil Gandhi, Senior Analyst – Commodities at HDFC Securities, said – “In the short term (10–15 days), gold appears to be in a recovery phase, with potential upside toward $5,025–$5,100, provided prices hold above $4,529. On MCX, gold is expected to recover toward ₹159,000– ₹161,180 as long as it sustains above the ₹147,100 support level.
From a medium-term perspective, spot gold is likely to consolidate within a broad range of $4,150–$5,250, while MCX gold may trade between ₹142,300 and ₹161,100.”
Disclaimer: This story is for educational purposes only. The views and recommendations above are those of individual analysts or broking companies, not Mint. We advise investors to check with certified experts before making any investment decisions.