Gold and silver prices opened sharply lower on the Multi Commodity Exchange (MCX) on Thursday evening as fresh US-Iran strikes boosted the dollar and spiked oil prices, fuelling concerns over rising inflation.In the domestic market, gold futures with June expiry on MCX dropped over 1% or Rs 1,977 per 10 grams to trade at Rs 1,53,650 per 10 grams. The contracts with August expiry also dropped more than 1% to Rs 1,57,725 per 10 grams during the evening session of the exchange.Silver futures with July expiry slipped nearly 2%, or Rs 5,171 per kilogram, to trade at Rs 2,61,041 per kg. The contracts with September expiry also declined nearly 2% to trade at Rs 2,68,100 per kg. MCX was closed in the morning session today on account of Bakrid.In the international market, gold prices dropped to a two-month low after US and Iran traded more air strikes, boosting the ‌dollar and crude ⁠prices, and ⁠fueling expectations of higher interest rates.Iran targeted a US air base in Kuwait on Thursday after the latter struck what Washington described as an Iranian drone operation near the Strait ‌of Hormuz and President Donald Trump rejected a reported deal with Tehran. This further raised worries over the existing ceasefire that continued to turn fragile. US Central Command said forces had shot down five Iranian attack drones and struck a ground control station in the port city of Bandar Abbas that was about to launch a sixth drone. Kuwaiti forces intercepted a ballistic missile fired towards the country, which hosts a large US base.Meanwhile, the Islamic Revolutionary Guard Corps said it had targeted the US base responsible for an early-morning attack near Bandar Abbas ⁠airport and that any repeat would lead to a "more decisive response", Tasnim news agency reported.The dollar rose to a one-week high, making greenback-priced bullion more expensive for holders of other currencies. Oil prices meanwhile jumped nearly 3% after Iran's Revolutionary Guards said they targeted a US airbase in response to a U.S. attack in ⁠the port ‌city of Bandar Abbas. Brent crude futures were trading above $97 per barrel, while WTI Crude futures were above $91 per barrel."Gold drops to a two-month low and into bear market territory as fresh U.S.-Iran hostilities douse hopes of a deal. Heightened geopolitical uncertainty directs risk-off flows to the dollar, just as higher oil prices exacerbate inflation fears," Reuters quoted Nikos Tzabouras, a senior market analyst at Jefferies-owned Tradu.com, as saying. "Higher-for-longer rate prospects weigh on non-yielding assets, compounding bullion's weakness and leaving it vulnerable to ‌new 2026 lows,” he added.(With inputs from agencies)(Disclaimer: Recommendations, suggestions, views and opinions given by experts are their own. These do not represent the views of The Economic Times)