Dollar, gold jump after Israel strikes Iran

Prices of safe haven assets saw a jump after Israel launched strikes against Iran. At 9:05 a.m. Indian standard time, 13^th June, 2025 spot gold price is up by 1.21%, trading at $3426.75 per ounce. US dollar index (DXY) is up 0.31%, at 98.23 level. DXY tracks the price of US dollar against a basket of major currencies.

Geopolitical risk shoots up

Both gold and dollar are considered as safe haven assets. Their prices tend to go up when uncertainty or risk increases. Geopolitical risk has increased significantly after these attacks of Israel against Iran. A strong Iranian retaliation looks imminent. How the risk unravels further will depend on the intensity of Iran’s retaliation.  If the retaliation is intense, then geopolitical risk will increase further. This in turn may cause gold and dollar to rise further.

Rupee may see depreciation against the dollar today

Rupee may depreciate against the dollar today because of this. Dollar has largely depreciated against other currencies since the start of 2025. Year-to-date in 2025, the DXY is down by more than 10%. If Israel’s strikes result in a full-blown war, then the dollar is likely to appreciate further. Many foreign investors will pull their money out of assets of other currencies and put them into dollar assets or assets of other safe haven currencies such as Swiss Franc.

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Source: Dollar index