Gold Prices Rise Amid US-Iran Tensions as RBI Keeps Repo Rate Unchanged
Gold prices in India's retail market rose on August 5 amid persistent geopolitical uncertainties and heightened tensions between the US and Iran, prompting investors to seek refuge in safe-haven assets. The upward movement came despite the US military asserting that the Strait of Hormuz remained accessible to all commercial shipping.
US Treasury Secretary Scott Bessent said a potential agreement with Iran could be imminent, suggesting a deal aimed at reopening the Strait of Hormuz may be reached as early as this week. Gold prices in India continued to reflect global market trends, currency movements, and investor sentiment.
The RBI decided to keep the benchmark repo rate unchanged at 5.25%, maintaining its neutral policy stance through a unanimous decision by the Monetary Policy Committee (MPC). The central bank also retained the Standing Deposit Facility (SDF) rate at 5%, while the Marginal Standing Facility (MSF) rate and the bank rate were kept unchanged at 5.5%.
Market analysts said precious metals are likely to remain sensitive to geopolitical developments, central bank policies, and movements in key global indicators. Any further escalation in international tensions could increase demand for gold as a traditional safe-haven asset, while signs of diplomatic progress may limit gains.