Why are gold and silver prices not rising amidst the US-Iran conflict?

Why Gold and Silver Are Not Rising Amid the US–Iran Conflict

Despite escalating tensions between the United States and Iran, prices of Gold and Silver have not shown the expected safe-haven rally. The primary reason lies in the dominance of macroeconomic factors over geopolitical sentiment. Rising oil prices are increasing inflation expectations, which in turn is reducing the likelihood of interest rate cuts.

Higher interest rates increase the opportunity cost of holding non-yielding assets like gold and silver, limiting their upside. At the same time, the strengthening US dollar is putting additional pressure on precious metals, as they are inversely correlated with the currency. Moreover, capital is rotating toward energy markets, where oil is the direct beneficiary of geopolitical tensions, leaving metals relatively sidelined. Profit booking after a strong prior rally and broader risk management strategies are also contributing to the muted response. Importantly, markets are not yet in a full panic mode, and without extreme fear or systemic disruption, safe-haven demand remains contained.