Market analysts have informed CNBC that if a peace agreement is reached between the US and Iran, gold and silver are expected to resume their upward trend. During the recent conflict, gold's performance was relatively muted overall, moving inversely to oil prices and the US dollar. Strategists anticipate that the bull market for precious metals will continue this year as various driving factors return.
On July 13, 2022, Robin Kolvenbach, CEO of the precious metals refining and minting company Argor-Heraeus, holds a 1-kilogram gold bar and a silver bar at the company's plant in Mendrisio, Switzerland. Market analysts told CNBC that as gold and silver prices rose on Thursday, the rally that drove the metals to record highs in 2025 could restart if a US-Iran peace deal is achieved. Boosted by market expectations of a potential agreement to end the 69-day conflict, spot gold surged 1.2% in early Thursday trading to $4,750 per ounce. Both spot gold and US gold futures increased by 1.2%, settling around $4,750 per ounce. Meanwhile, spot silver rose 3% to $79.62 per ounce, while July silver futures jumped 3.9%. In 2025, gold and silver experienced an epic bull market, soaring 66% and 135% for the year, respectively. However, volatility increased significantly in 2026: silver futures recorded their largest single-day drop since the 1980s in late January, and gold retreated more than 10% from its January peak. Ross Norman, CEO of the precious metals information website Metals Daily, stated that since the US-Iran war began on February 28, gold's traditional role as a safe-haven asset has been tested, and the multiple factors previously supporting its price rise have been questioned. Expectations of rising interest rates, a stronger dollar fueled by soaring oil prices, and concentrated selling by traders collectively pressured gold prices. Additionally, gold was in a severely overbought condition at the conflict's onset, further triggering a correction. He told CNBC that the overbought conditions at high levels gave traders a reason to take profits, leading investors to reduce exposure to previously strong assets and the market entering a consolidation phase. Francis Tan, Chief Asia Strategist at Credit Agricole Wealth Management, said in a CNBC interview on Tuesday that gold's hedging value became apparent during the March market turbulence. "Looking back at the stock market sell-off in March, investors holding gold achieved substantial gains, allowing them to sell some gold holdings to offset losses in equity assets. Gold's safe-haven value is undeniable," he said. During this conflict, gold's price movement showed an inverse correlation with both oil prices and the US dollar. Norman added, "Tight energy supplies spurred hot money inflows, and the dollar strengthened simultaneously due to safe-haven demand, leading to a period where both the dollar and gold rose. If a peace agreement is reached, these supportive factors will gradually fade, and the market has already started pricing in this expectation, as if the handbrake restraining gold and silver's ascent has been released."
**Outlook** Philippe Gijsels, Chief Strategy Officer at BNP Paribas Fortis, maintains a long-term bullish view on gold and silver. Even amid ongoing sharp volatility in the precious metals market, he remains convinced that both metals have further upside potential. He told CNBC on Thursday that the recent decline in gold and silver represents a phase of consolidation. "The correlation between precious metals and stock markets has significantly increased recently, with both being weighed down by rising inflation and expectations of interest rate hikes. In market logic, interest rates act like gravity; when the gravitational pull of rising rates intensifies, all assets, including precious metals, face downward pressure." As the Iran conflict persisted, concerns about soaring energy prices and hampered economic growth led major economies to price in a pause in monetary easing, with some central banks potentially even raising rates to counter inflation pressures stemming from higher energy costs. However, reports on Wednesday suggesting the US and Iran are close to a peace deal rekindled market optimism, leading to a simultaneous recovery in precious metals and equities. Gijsels stated, "We believe the long-term bull market for gold and silver will restart, potentially reaching new record highs soon, possibly as early as this year." He pointed out, "As the fog of war lifts, investors will return to the gold and silver markets." He believes the core logic that drove the substantial rally remains intact: central banks and governments will continue reducing US Treasury holdings and increasing gold allocations; the global economy remains in a structurally high-inflation environment, necessitating investor allocation to physical assets, with precious metals being a core choice. The recent pullback in gold and silver does not signal the end of the bull market but rather a brief pause within what is arguably the strongest and longest bull run in history. Paul Williams, Managing Director at precious metals supplier Solomon Global, told CNBC via email on Thursday that predicting precise price movements is challenging while conflict persists, especially given silver's higher volatility. However, he shares Gijsels' view: the fundamental drivers behind silver's strong performance in 2025 have not changed. He said, "Physical silver supply remains tight, demand from the green technology sector stays robust, and the US-Iran conflict has further highlighted the strategic value of solar energy. Simultaneously, demand for silver from the AI industry chain is strong and growing, putting additional pressure on an already tight supply-demand balance." Silver has wide-ranging applications across numerous industrial sectors, including computers, mobile phones, solar panels, and automobiles. Williams believes that short-term volatility in silver will persist until a lasting US-Iran peace agreement is reached, but long-term prices are supported by fundamentals. "An increasing number of investors are seeking the safety and preservation of value offered by physical assets outside the traditional financial system. Gold and silver still have room to rise, and the bullish structure remains unchanged. If a peace deal is signed, improving economic sentiment, recovering industrial demand, and rising investor risk appetite would significantly benefit silver. If peace talks fail, gold would likely lead a safe-haven rally, and silver, supported by tight physical supply and demand, would quickly follow."
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