Gold and silver prices staged a strong recovery on Wednesday after suffering a brutal selloff over the past few sessions, with bullion drawing support from a softer US dollar, easing oil prices and hopes that tensions in the Middle East may cool.
The rebound comes after one of the sharpest corrections in precious metals in decades. Gold, which had come under heavy pressure after the West Asia conflict triggered a surge in the dollar and broad-based risk reduction, is now attempting to stabilise. Silver, too, has bounced back sharply after an even steeper decline. Still, analysts caution that the recovery does not necessarily signal the start of a fresh, sustained rally. With geopolitical uncertainty around the US-Iran conflict far from resolved and the outlook for the US Federal Reserve and the dollar still in flux, both gold and silver are expected to remain volatile and range-bound in the near term.
On the Multi Commodity Exchange (MCX), gold futures for April delivery climbed sharply by over Rs 5,000 during the day. The contract was quoted around Rs 1,44,003 per 10 grams, up Rs 5,091 or 3.66%. In another update during the session, gold futures were seen rising 4% to Rs 1,44,434 per 10 grams.
Silver futures for May 2026 delivery also saw a powerful rebound, surging by Rs 12,196, or 5.4%, to Rs 2,36,137 per kilogram. In international markets, spot gold rose as much as 2.5% to $4,587.09 per ounce earlier in the session, while US gold futures for April delivery jumped more than 4% to around $4,586.10. Later, spot gold was trading around $4,545-$4,558 an ounce, still holding strong gains. Spot silver rose to about $73-$74 per ounce, while platinum and palladium also advanced. Despite the recovery, gold remains roughly 17% below its late-January peak, underlining how fragile the recent price action remains.
A combination of macroeconomic and geopolitical triggers has driven the latest bounce in bullion. A softer US dollar has made gold and silver cheaper for holders of other currencies, helping revive buying interest. At the same time, oil prices have fallen below the psychologically important $100 per barrel mark amid reports that Washington is working on proposals to end the conflict with Iran. Lower crude prices have eased inflation fears, reducing market anxiety about higher global interest rates.
Hareesh V, Head of Commodity Research at Geojit Investments Limited, said gold’s nearly 4% surge on MCX and silver’s sharp rebound were driven by the weaker dollar and easing inflation concerns after crude corrected. He added that value buying after the recent sharp fall, along with short covering, amplified the upside move.“Gold and silver may see a mild near-term recovery, but breaking recent highs looks difficult. While supportive geopolitics could underpin sentiment, a firm US dollar is likely to cap strong upside, keeping price movements relatively restrained for now,” he said. Christopher Wong, strategist at OCBC, also said gold remains highly sensitive to expectations around the US Federal Reserve, the dollar and geopolitical developments. However, he noted that the rebound suggests dips may continue to find support unless real yields rise significantly.
The recent crash in precious metals came after a dramatic reversal in market sentiment following the outbreak of the conflict in West Asia. Initially, geopolitical uncertainty had supported safe-haven flows into bullion. But as energy prices spiked and the dollar strengthened sharply, the trend reversed. Investors moved into the US currency, while panic selling, profit booking and fresh short positions intensified the decline in gold and silver.
Navneet Damani, Head of Research for Commodities and Currencies at Motilal Oswal Financial Services, said bullion prices were under pressure due to panic selling and new short positions, with investors exiting as prices fell. Gold has fallen about 21% from its record high of $5,595 per ounce to around $4,400 levels seen earlier this week. Silver has dropped even more sharply, down 43% from its lifetime peak of $ 121.70 to around $ 69.30.
Since February 27, when the conflict began, gold prices have declined 16%, while silver has fallen 26%. Gold is still marginally up about 1% for the year, but silver remains down around 5% in 2026. Anindya Banerjee, Head of Commodity and Currency Research at Kotak Securities, said the 100%-150% surge in energy prices due to the West Asia conflict boosted dollar demand and triggered the selloff in bullion. He added that if the conflict is resolved, dollar demand could cool, opening the door to a stronger rebound in gold and silver.
The market’s near-term direction remains tied to developments around the US-Iran conflict. US President Donald Trump said Washington and Tehran were “currently in negotiations” and suggested progress was being made toward ending the war. He also indicated he had paused plans for strikes on Iranian energy infrastructure because negotiations were underway.
Iran, however, denied any direct talks with the United States, creating conflicting signals that have kept investors cautious. Praveen Singh, Head of Commodities at Mirae Asset ShareKhan, said that spot gold, after falling for nine straight sessions, is now stabilising around $4,420 per ounce amid cautious optimism over the situation in Iran. However, he warned that uncertainty over the effectiveness of any ceasefire will likely keep investor sentiment guarded and bullion prices volatile.
The fall in oil prices has offered some near-term relief to commodity markets and to the broader macro outlook. Brent crude, which had approached $101 per barrel, dropped to around $91, while US crude also fell sharply. For India, this matters because lower oil prices can reduce pressure on inflation, the current account deficit and the rupee.
Rajeev Sharan, Head of Research at Brickwork Ratings, noted that every $10 per barrel swing in crude can shift India’s current account deficit by 0.3 to 0.5 percentage points of GDP and raise CPI inflation by 20 to 30 basis points, depending on pass-through. He said the recent moderation in oil and gold offers temporary relief, but any renewed spike in crude or fresh capital outflows could quickly revive pressure on the rupee.
JPMorgan said the recent correction in gold, though severe, fits the pattern of past tactical pullbacks. The bank noted that, despite gold trading well below pre-conflict levels due to dollar strength and broad de-risking, such flushes have historically presented buying opportunities. It added that the bullish case for gold strengthens if the conflict drags on.
Goldman Sachs has also maintained a constructive long-term stance. While the bank said the recent decline reflects some normalisation after an overshoot, it remains structurally bullish. It sees gold at $5,400 by year-end, supported by continued central bank buying and diversification into assets with lower geopolitical and financial risks.
Gold and silver have recovered strongly from their recent lows, but analysts broadly agree that volatility is likely to remain elevated. Prices will continue to react to headlines on the US-Iran conflict, changes in oil prices, movements in the dollar and shifts in US rate expectations. In the short term, experts suggest investors avoid chasing the rally aggressively after a one-day spike. The market is still fragile, and stronger dollar moves or a renewed jump in real yields could cap gains.
At the same time, long-term investors may view sharp corrections as an opportunity to accumulate gradually, especially if they believe geopolitical tensions, central bank buying and structural demand for safe-haven assets will continue to support bullion over time.