Gold Vs Silver Vs Sensex; Know 20-Yr Returns! Will Gold Rates In India Rise MORE As Israel-Iran War Escalates?

Gold rates in India are mind-bogglingly high and have hit a new all-time high as Israel and Iran attack each other, escalating the already-heightened tensions in the Middle East. The price of 10 grams of 24-carat gold reached nearly Rs 1,02,000, while the MCX gold price climbed to a new record high of Rs 100,681 per 10 grams. Gold in India is more expensive than before, but its outlook remains bullish.

But did you know gold has outperformed Sensex four out of five times on a year-on-year basis since 2021? Compared to silver, gold has been the most preferred safe haven since 2021.

What Is Happening In Israel And Iran?

Last week, on June 13, Israel carried out a surprise attack on dozens of Iranian military bases and nuclear facilities, damaging their systems, and also killing key chiefs of Iranian armed forces. Iran retaliated on the same day with a barrage of 100 drone attacks. It's the third day, on Sunday June 15, Iran and Israel have exchanged a series of attacks in the skies against each other's soils.

Tensions between Iran and Israel have been high since the Jewish-majority nation carried a ground war on Gaza-based Hamas terrorists after October 7th, 2023. But since last year, the two countries have on several occasions entered into severe and grave attacks on each other. Iran backs its proxy terrorists like Hezbollah in Lebanon and Hamas in Gaza.

As of latest, Israel's PM Benjamin Netanyahu called the latest operation as a move to roll back Iran's threat on Israel's very survival. President Donald Trump, backing Israel, asked Iran to enter a deal with the US on their nuclear programme with a warning that said 'before there is nothing left'.

The conflict has taken centre stage currently across the world. And when geopolitical tensions escalated, gold saw sharp buying sentiment since June 13.

"Given the geopolitical issues, gold is a haven and will have an upward bias in prices as a result of the conflict. Also, for India, movement in crude has a significant impact, directly or indirectly. The conflicts, such as what we are witnessing now, have, by and large, a negative connotation for credits, barring a few," Amod Khanorkar, Chief Rating Officer at Infomerics Valuation and Ratings Ltd said.

Gold Prices In India:

As of June 16, 2025, gold prices in India are at its highest level. 10 grams gold price is at Rs 1,01,680 in 24 carat, at Rs 93,200 in 22 carat, and at Rs 76,260 in 18 carat.

Meanwhile, 100 grams gold rates stood at Rs 10,16,800 in 24 carat, at Rs 9,32,000 in 22 carat, and at Rs 7,62,600 in 18 carat.

Silver Prices In India:

Silver rates are also at their record levels. 1 kg silver price is Rs 1,10,000, while 100 grams and 10 grams silver price stood at Rs 11,000 and Rs 1,100 respectively.

MCX Gold, Silver Prices:

On Friday, the MCX gold price, with an August 2025 expiry, surged to a new all-time high of Rs 1,00,681 per 10 grams before ending at Rs 1,00,314 per 10 grams, up marginally.

Meanwhile, MCX silver price, with July 2025 expiry, neared to its record high. This commodity touched an intraday high of Rs 1,06,940 per 1kg on June 13, before correcting in closing bell. Silver closed at Rs 1,06,474 per 1kg, down marginally but near its lifetime high of Rs 1,07,369 per 1kg.

"Tensions between the US, Israel and Iran have suddenly escalated bringing gold solidly back in business. Given the situation, it's highly likely that gold may show big spikes upwards till we have a resolution of some kind in this. In the background, Ukraine Russia and US-China tariff situations continue to haunt dollar hunters who would rather now prefer gold. President Donald Trump has said he is less confident about reaching a deal with Tehran and that he could take military action against Iran if negotiations fail which could add a tremendous amount of uncertainty across the region," said, Sandip Raichura, Executive Director, CEO Retail and Distribution - PL Capital Group.

Adding, Raichura's note said, in the US, jobless claims remain at their highest level since early October 24 adding to fears that the US is decidedly going lower. Potential rate cuts by the Fed could add to the fears as well about a slowdown in the US.

Where is Gold Prices In India Headed Amid Israel-Iran Tensions?

According to Rahul Kalantri, VP Commodities, Mehta Equities, gold prices touched a new high and scaled past Rs 1 lakh-mark per 10 gram while in the international markets the bullion soared past $3,440 per ounce as investors flocked to safe-haven assets amid mounting global instability. The sharp rally followed Israel's pre-emptive strike on Iran, escalating fears of a broader Middle East conflict. Simultaneously, renewed uncertainty over U.S. trade policy including threats of unilateral tariffs by President Trump-fueled risk-off sentiment. Treasury Secretary Bessent's remarks about possibly extending the 90-day tariff pause failed to ease concerns. Additionally, weaker-than-expected U.S. inflation data strengthened expectations for further Fed rate cuts, enhancing gold's appeal.

In the international market, Kalantri added, "gold prices are expected to find support near $3,380, with resistance at $3,465. Domestically, key levels are seen at ₹99,000 for support and Rs 1,01,450 as resistance. Given the recent sharp rally and heightened volatility driven by escalating geopolitical tensions, it is advisable to adopt a wait-and-watch approach before taking new positions."

Noteworthily, Manav Modi, Senior Analyst, Commodity Research at Motilal Oswal Financial services believes that this latest spike in hostilities in the Middle East has taken the focus off trade negotiations for now, and built the risk premium once again in the market.

Along the similar lines, Ramaswamy Head -Commodity desk and CRM - Ventura said, risk off sentiments dominates as middle east conflicts between Israel and Iran escalate. US and Iran too is engaged in a long-standing power struggle.

Giving an outlook, Ventura's expert said, "US-China trade deal optimism was short-lived with limited details as US President Trump once again raises the trade tariff uncertainty, which added to the gold appeal. Gold's rise is further supported by easing inflation pressures in the U.S. Both the inflation reports from US has fuelled expectations of aggressive interest rate cuts by the FED, but for the risk of tariff impacts in the coming months. Weakness seen in USD against major currencies. US Dollar weakening is also due to FED likely pausing rate hikes. Global central banks are on pace to accumulate over 1,000 metric tons of gold in 2025, marking a fourth consecutive year of heavy buying.US Central Bank decisions from FED is slated for 18th June 2025 (Wednesday) which could provide a clearer path.

He also said, Gold's safe-haven appeal is likely to remain strong, particularly amid ongoing global uncertainties. It remains a critical asset in the portfolios of investors seeking stability and protection from volatility. Gold in the international COMEX market is likely to surpass the $3509 high from the present $3430 levels and create a high of $3540 in the short term with resistance at $3476. Support for COMEX Gold is seen at $3400 and $3345. Gold in the domestic market MCX August Futures presently is Rs.99800 (Made high of Rs.100403). With support at Rs.98900, its poised to surge to Rs.102000 in the short term."

Any escalation in the Israel-Iran conflict is expected to push gold to new heights. Aksha Kamboj, Vice President, India Bullion and Jewellers Association and Executive Chairperson, Aspect Global Ventures said, Iran has pledged to retaliate after being formally censured by the UN's nuclear watchdog. Meanwhile, uncertainty surrounding the US-China trade negotiations, compounded by President Donald Trump's threat to impose unilateral tariffs within two weeks, has pushed investors toward traditional safe-haven assets. Market attention will remain focused on the evolving conflict in the Middle East and any forthcoming response from China regarding the trade tensions. Any further escalation is likely to drive gold prices higher, potentially pushing them back toward previous record highs.

Gold Vs Silver Vs Sensex:

Data from Kedia Advisory showed that from 2021 to date, gold outperformed Sensex three times on year-on-year basis. Gold beat Sensex in 2022 with an upside of 14.4% YoY, in 2024 with 21.4% surge, and from January 1, 2025 to June 13, 2025, gold soared by 30.30%.

On the other hand, Sensex outperformed gold in 2021 with an upside of 21.99%, and 2023, with gains of 18.74%.

Notably, except for 2022, gold has given more returns than silver. From 2005, Sensex saw three negative years in 2008, 2011, and 2015, better than gold and silver. Gold has seen four negative performances in 2013, 2014, 2015, and 2021. While silver underperformed both gold and silver with five negative years in 2008, 2013-2015, and 2021.