Gold and silver prices have plunged sharply after hitting lifetime highs earlier this week. Gold has fallen over 6 per cent globally and around Rs 4,300 in India, while silver prices have dropped nearly 12 per cent from their peak.
Gold prices continued to slide in the global market on Wednesday, extending the sharp fall seen earlier this week. On Tuesday, the yellow metal registered a massive drop of over 5 per cent – the biggest single-day decline in nearly five years since August 2020. As of Wednesday, spot gold was trading 0.4 per cent lower at USD 4,109.19 per ounce, down more than 6 per cent from its all-time high of USD 4,381.21 per ounce hit on Monday. The sharp sell-off has triggered expectations of heavy selling in domestic bullion markets as well, which could lead to a noticeable drop in local gold prices.
Domestic gold prices down from lifetime high
The gold prices have fallen more than Rs 4,294 or about 3 per cent from their record level in India. After touching an all-time high of Rs 1,32,294 per 10 grams, gold is now hovering around Rs 1,28,000 per 10 grams in local markets. Experts say this correction comes amid profit booking by investors after a record rally in gold this year. Notably, gold has delivered nearly 60 per cent returns so far in 2025, outperforming most other asset classes. Analysts also point to improving trade relations between the US and China, along with optimism over India-US trade talks, as factors contributing to the latest decline in prices.
Silver prices crash
Silver too witnessed a steep fall, both globally and domestically. In the US market, silver prices slumped 8 per cent on October 21, marking the sharpest one-day decline since 2021. It fell to USD 48.11 per ounce, down nearly 12 per cent from its lifetime high of USD 54.47 per ounce recorded on October 17. Back home, silver prices in the domestic bullion market dropped by Rs 8,100 within just two days and are now trading around Rs 1,63,900 per kg.
The decline has been attributed to a stronger US dollar, speculation that the US Federal Reserve may delay interest rate cuts, and reduced industrial demand from the electronics and solar energy sectors. Despite the drop, experts note that silver prices are still holding at relatively elevated levels.
What lies ahead for investors?
Market watchers believe that while the recent correction in gold and silver prices may worry short-term investors, long-term fundamentals for both metals remain strong. Inflation concerns, geopolitical tensions, and central bank buying are expected to continue supporting bullion demand in the months ahead. However, traders are advised to stay cautious amid high volatility and global market uncertainties.
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