Gold rate today: After delivering historic returns, the rally in gold prices slowed down. In recent months, the bullion has turned volatile, especially since the onset of the US-Iran war.
has risen ₹30,000 per 10 grams, translating to a stellar nearly 14% gain in just the first five months of 2026, building on the roughly 50% gain in 2025.
In mid-January, domestic prices witnessed an explosive, unprecedented overnight surge, quickly smashing past ₹1,80,000. On the global front, breached the historic $5,600 per ounce mark for the first time.
What’s driving gold prices?
However, lingering uncertainty surrounding a possible US-Iran agreement, along with reports of Israeli strikes in southern Lebanon, kept investors cautious. On Thursday, fresh US strikes on Iran strengthened the dollar and lifted oil prices, fuelling concerns over rising inflation and creating uncertainty around the interest rate outlook.
A high-rate environment doesn’t bode well for non-interest-yielding bullion.
The dollar climbed to a one-week high, making gold — which is priced in greenbacks — more expensive for holders of other currencies.
US officials were quoted as saying by Bloomberg that the American military launched new attacks in Iran targeting a military site believed to threaten US forces and commercial shipping in the Strait of Hormuz. The strikes came just hours after President Donald Trump rejected an Iranian report claiming an agreement had been reached to restore traffic through the crucial waterway.
Oil prices surged more than 2% on Thursday after Iran’s Revolutionary Guards said they had targeted a U.S. airbase in retaliation for the American attack.
Higher crude prices can fuel inflationary pressures and may force interest rates to remain elevated for a longer period. Although gold is traditionally viewed as a hedge against inflation, higher interest rates generally reduce the appeal of the non-yielding metal.
Meanwhile, Federal Reserve Governor Lisa Cook said on Wednesday that she believes the US central bank should keep short-term interest rates unchanged for now. However, she added that rising prices driven by tariffs, the Iran conflict, and increased AI-related investments could prompt the Fed to raise rates if necessary.
Can gold prices fall below ₹1.50 lakh?
According to Kaynat Chainwala, AVP – Commodity Research, Kotak Securities, if current diplomatic progress leads to a durable resolution, could rally toward higher levels; however, a down move is not implausible if the geopolitical situation deteriorates, the Fed turns more hawkish than expected, or dollar strength accelerates.
“Structural support from central-bank buying provides a floor, but it may slow the descent rather than prevent it entirely. Currently, 1,54,500 represents the first meaningful support, and a sustained break below that would open the door toward the 1,50,000 mark. That remains a realistic, though not base-case, scenario, contingent on how the West Asia situation and the Fed narrative evolve over the coming weeks,” Chainwala said.
Meanwhile, Renisha Chainani, Head of Research at Augmont, believes that a fall below ₹1.50 lakh in Indian gold prices anytime soon appears highly unlikely.
Chainani highlighted that domestic prices have already rallied approximately 20% year-to-date in 2026, driven by a 7% rupee depreciation and the customs duty hike from 6% to 15% effective May 13, 2026. Triggers for a deeper fall include a hawkish Fed pivot, a sustained dollar rally, or geopolitical risk resolution deflating the fear premium.
“While Q1 2026 jewellery demand fell 23% and ETF flows slowed, central bank buying rose 2% and aggregate demand still grew 2%, keeping structural bullish drivers intact. ₹1.50 lakh is effectively the floor, not a downside target,” she added.
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.