Silver Price Crash: Silver Crashes Within a Week... Drops by ₹32,000; Gold Slumps by ₹13,000

Gold and silver prices have been quite surprising over the last few days. This is because, typically, the prices of both precious metals tend to rise during times of disaster or global tension; however, amidst the ongoing conflict in the Middle East, they are currently plummeting sharply.

Compared to its all-time high, a kilogram of silver is now available at a discount of ₹1.92 lakh.

Within just the last week, silver prices crashed significantly, becoming cheaper by nearly ₹32,000 per kilogram. Gold also witnessed a steep decline, sliding by over ₹13,000 during the five trading days of the previous week alone.

Sharp Decline in Silver Prices

During the five trading days of the previous week, silver prices collapsed dramatically. On March 13, the price of silver with a May 5th expiry—traded on the Multi Commodity Exchange (MCX)—stood at ₹2,59,435 per kilogram. By Friday—the final trading day of the week—it had tumbled to ₹2,23,305. This marked a reduction of ₹36,103. However, the decline moderated slightly towards the end, and the price closed at ₹2,27,470.

Consequently, over the course of the week, silver prices fell by a total of ₹31,965.

The price of silver—which has been crashing continuously—now stands significantly lower than its all-time high. In fact, silver futures prices crossed the ₹400,000 per kilogram mark for the first time this year on January 29, reaching an all-time high of ₹420,048. When comparing the current price to this peak, the price of 1 kg of silver is lower by ₹192,578.

Gold Prices Remain Sluggish

Apart from silver, gold, too, continues to remain sluggish. On the MCX, during the final trading session of the previous week—Friday—gold futures with an April 2 expiry closed at ₹144,825 per 10 grams, registering a marginal gain. However, if one calculates the decline based on the losses incurred over the remaining four trading days, gold prices have slipped by ₹13,641 per 10 grams. Indeed, on March 13, the MCX gold rate stood at ₹158,466 per 10 grams, which subsequently dropped to ₹144,825 by Friday.

Much like silver, gold has also become significantly cheaper compared to the high levels recorded on January 29. Its all-time high stands at ₹193,096; when compared to the current market rate, the price of 10 grams of 24-karat gold is lower by ₹48,271.

Gold and Silver Prices in the Domestic Market

Beyond the MCX, if we examine the price fluctuations of gold and silver in the domestic market—according to the Indian Bullion Jewelers Association's website, IBJA.com—rates for both precious metals have declined there as well. Over the course of the week, the price of 24-karat gold fell from ₹158,399 to ₹147,218 per 10 grams. Consequently, gold has become cheaper by ₹9,181 per 10 grams in the domestic market.

In addition to gold, the domestic market price of silver during this same period dropped from ₹260,488 per kilogram to ₹232,364. This means that even this precious metal has become cheaper by ₹28,124 per kilogram. It is worth noting that the rates listed on the IBJA website exclude GST and making charges, and they remain uniform across the country. The final price increases once the 3% GST and varying making charges—which differ from state to state—are added.

Major Reasons Behind the Drop in Gold and Silver Prices

Regarding the reasons behind the fall in gold and silver rates—despite the ongoing conflict involving the US, Israel, and Iran—the US Federal Reserve's decision to keep interest rates steady has exerted downward pressure on both precious metals. Additionally, escalating tensions in the Strait of Hormuz and a surge in crude oil prices have heightened concerns regarding rising global inflation. The strengthening of the US dollar is also playing a significant role in the decline of gold and silver prices.