Gold not glittering despite Middle East tensions: 5 reasons why prices remain flat

Gold Price Today: Despite the sixth day of direct missile attacks between Iran and Israel and growing fears of a broader war in the Middle East, gold isn’t showing the usual safe-haven shine. Spot gold was flat at $3,388.04 an ounce, and US gold futures hovered at $3,406.50. Back home, domestic gold prices also dipped on profit booking.

Here are five reasons why the precious metal has stayed subdued:

1. All eyes on the US Fed, not the battlefield
Investors are playing the waiting game ahead of the US Federal Reserve’s policy decision. With no rate change expected this week, the market is looking for cues on future rate cuts.“Gold prices remain volatile as markets await clearer signals on what action the U.S. may take amid rising tensions between Iran and Israel,” said Aksha Kamboj, VP, India Bullion and Jewellers Association.

2. Mixed US economic data muddy the waters
A sharper-than-expected drop in US retail sales and weakness in industrial output have raised hopes of monetary easing. But it’s not strong enough yet to cause a gold rally.“Tepid US data strengthens the case for rate cuts later this year,” said analysts at ANZ.

3. Profit booking in Indian markets
Back home, gold has extended losses for a second straight day. Traders are cashing out at higher levels.
In Mumbai, 22-carat gold was priced at Rs 92,500 per 10 grams, while 24-carat gold stood at ₹1,00,910.

4. Rupee weakness lending limited support
Domestic prices are finding some support due to the depreciating rupee.“Gold has near-term support at Rs 98,920 - Rs 98,590 and resistance at Rs 99,950 - Rs 1 lakh,” said Rahul Kalantri of Mehta Equities.

5. Institutional demand is steady, not surging
The SPDR Gold Trust, the world’s largest gold-backed ETF, saw a modest 0.43 per cent uptick in holdings on Tuesday, showing stable but not aggressive institutional buying.

Goldman Sachs expects gold to rise to $3,700/oz by end-2025 and hit $4,000 by mid-2026, driven by central bank demand and ETF inflows. But in the near term, the metal may remain range-bound unless the Fed signals a dovish pivot or the Middle East conflict escalates dramatically.