Silver collapses 19 pc to Rs 3.12 lakh per kg as strong dollar triggers global selloff

Silver prices collapsed 19 per cent to Rs 3.12 lakh per kg in the national capital on Saturday, while gold plunged 2 per cent to Rs 1.65 lakh per 10 grams, as investors booked profits amid a global selloff triggered by a stronger US dollar.

Silver prices collapsed 19 per cent to Rs 3.12 lakh per kg in the national capital on Saturday, while gold plunged 2 per cent to Rs 1.65 lakh per 10 grams, as investors booked profits amid a global selloff triggered by a stronger US dollar. According to the All India Sarafa Association, silver nosedived Rs 72,500, or 18.85 per cent, to Rs 3,12,000 per kilogram (inclusive of all taxes), marking a second straight day of heavy losses, wiping out much of this week's record gains. The white metal had touched a record of Rs 4,04,500 per kg on Thursday before plummeting 5 per cent in the previous session. Silver prices, however, closed January with sharp gains, soaring Rs 73,000, or 30.5 per cent, from Rs 2,39,000 per kilogram recorded on December 31, 2025, despite a steep fall in two consecutive sessions to Saturday. Gold prices also lost sheen, sliding Rs 3,500, or 2.07 per cent, to Rs 1,65,500 per 10 grams (inclusive of all taxes). The metal of 99.9 per cent purity plunged 7.6 per cent to Rs 1,69,000 per 10 grams in the previous trade after hitting a record of Rs 1,83,000 per 10 grams on Thursday. In January, gold prices rose by Rs 27,800, or 20.2 per cent, from Rs 1,37,700 per 10 grams recorded at the end of last year. Analysts said the sell-off was driven by a rebound in the dollar, which weighed on gold and silver prices. The dollar index rose 0.9 per cent to close at 97.15 after US President Donald Trump nominated Kevin Warsh, a former Fed governor and known proponent of a strong dollar, to head America's central bank, the Federal Reserve, dented the appeal for the safe-haven assets, they added. The carnage in both silver and gold was even more severe in global markets. On Friday, spot silver slumped USD 31.44, or 27.07 per cent, to close at USD 84.70 per ounce, after plunging as much as 36 per cent intraday to USD 73.30 per ounce, while gold slid by USD 530.53, or 9.83 per cent, to settle at USD 4,865.35 per ounce. During the session, the yellow metal tanked USD 689.92, or 12.8 per cent, to hit an intraday low of USD 4,683.10 per ounce. Silver and gold had notched all-time highs of USD 121.45 and USD 5,595.02 per ounce on Thursday, driven by safe-haven demand. Sandip Raichura, CEO of Retail Broking and Distribution & Director, PL Capital, said, ''Warsh's nomination triggered profit booking in Asia, which then spread to the rest of the world''. Barring gold, where we believe fundamental strength will continue for years to come, though, of course, volatility will remain, other precious metals have seen some froth build up, he said. ''Silver had a non-linear run and had reached severely overbought levels. When profit booking begins, drawdowns have historically been significant, and Friday was no different, despite no major actual moves in the US dollar,'' he added. Raichura further stated that ''We believe silver may lose further ground but could find a base around the USD 60 per ounce level, where it would still be trading at nearly four times the cost of production''. On the outlook, he said, Gold is expected to continue moving upwards in the medium term towards the USD 6,000 and subsequently the USD 8,000 level over the next two years. Gaurav Garg, Research Analyst at Lemonn Markets Desk, said the bullion has delivered exceptional gains this month, and such pullbacks are healthy consolidations rather than trend reversals. ''However, elevated prices have begun to weigh on physical demand, particularly in price-sensitive markets like India, suggesting near-term volatility may persist even as the broader bullish outlook for bullion stays intact,'' he added. Meanwhile, jewellers expect policy support ahead of the Union Budget to revive the demand. The Union Budget for 2026-27 will be presented in Parliament on February 1.

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