Gold climbs as Middle East war drives demand for safer assets

Gold rose for a fourth day, as war in the Middle East rattled markets and drove investors to safer assets.

Bullion climbed as much as 2.2% to top $5 390 an ounce in early trading, before paring some of those gains. Conflict in the region spread over the weekend after the US and Israel attacked Iran — killing the Islamic Republic’s supreme leader, Ayatollah Ali Khamenei — and Tehran responded with waves of missiles at targets in multiple countries.

Wider geopolitical tensions and US President Donald Trump’s upheaval of international relations and trade have underpinned a long-running rally for gold, which has also been supported by elevated central-bank buying and a wider investor shift away from sovereign bonds and currencies. The metal has gained about a quarter so far this year, despite an abrupt pullback from a record high above $5 595 an ounce at the end of January.

Bullion tends to benefit when cross-asset market sentiment is “risk-premium first, fundamentals later,” analysts from Franklin Templeton Institute led by Stephen Dover said in a note, recommending “selective gold exposure over broad equity shorts.”

Even ahead of the war with Iran, Trump had adopted an increasingly aggressive foreign policy. US troops seized Venezuela’s then-president Nicolás Maduro in January and the administration made threats to annex Greenland. With Washington amassing its biggest military deployment in the Middle East since the Iraq War in 2003, bullion posted its seventh consecutive monthly gain in February — the longest streak since 1973.

On Saturday, the US and Israel launched strikes across Iran while calling on the population to rise up against the Islamic regime. Tehran’s retaliatory barrage hit targets in Israel, as well as American bases and sites in countries including Qatar, the United Arab Emirates, Kuwait and Bahrain. Trump said US forces will continue bombing Iran until his objectives have been achieved, while Iran’s national security chief, Ali Larijani, said on X that Tehran won’t negotiate with the US.

Oil surged by the most in four years when markets opened on Monday, with the effective closing of the Strait of Hormuz threatening disruption to crude supplies. Like gold, it later pared gains. The dollar rose, with the Bloomberg Dollar Spot Index — a key gauge of the US currency — climbing 0.4%.

“Precious metals, oil and commodities are rising despite the dollar’s rebound, even though they are priced in US dollars,” said Hong Hao, chief investment officer of Lotus Asset Management. “This demonstrates that these hard assets are the true hard currency during this extraordinary period,” he said.

Spot gold rose 1.6% to $5 365.23 an ounce as of 2:05 p.m. in Singapore. Silver climbed 0.6% to $94.35. Platinum gained 1% and palladium advanced 2.5%.

© 2026 Bloomberg

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