- Silver prices fell nearly 44% from peak, signaling a major momentum shift globally and domestically
- MCX silver dropped 43.84% from Rs 4,39,337 to Rs 2,38,296, nearing critical support levels
- Key MCX supports are Rs 2,33,772 and Rs 2,31,968; deeper correction may hit Rs 2,26,130
Silver prices have witnessed a steep correction, falling nearly 44% from their peak, signalling a significant shift in momentum amid evolving macroeconomic and geopolitical dynamics.
On the domestic front, MCX silver prices have declined 43.84% from a high of Rs 4,39,337 to around Rs 2,38,296, indicating a Rs 2 lakh correction. According to Kotak Securities' commodity research desk, the May contract is approaching critical support levels that could determine the near-term trend.
The first key support is seen at Rs 2,33,772, followed by Rs 2,31,968. A deeper correction could push prices toward Rs 2,26,130 if selling pressure intensifies.
Market experts warn that a decisive break below the Rs 2,40,000 mark could accelerate the decline. Ponmudi R, CEO of Enrich Money, said prices may slip toward the Rs 2,39,000–Rs 2,38,000 range initially, with further downside extending to Rs 2,35,000–Rs 2,32,000 levels.
“The near-term outlook remains cautious, with price action dependent on sustaining above key supports, while geopolitical developments and macro cues continue to drive direction,” he noted.
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Globally, spot silver has also corrected sharply, dropping 37.15% from its peak of $121.65 to around $72.72. Analysts see immediate support at $71.67, followed by $70.92, with a deeper floor at $68.46.
The recent sell-off in precious metals has been driven by a shift in capital flows rather than a collapse in safe-haven demand. Sachin Sawrikar of Artha Bharat Investment Managers IFSC LLP explained that rising crude oil prices are drawing inflation-hedge capital away from metals.
With Brent crude trading above $110 per barrel, inflation expectations have surged, leading markets to scale back expectations of near-term rate cuts. This has increased yields and reduced the appeal of non-yielding assets like silver and gold.
Silver, in particular, has underperformed due to its dual role as both a precious and industrial metal. Elevated energy prices raise concerns about demand destruction in industrial sectors, making silver more vulnerable compared to gold during growth-sensitive phases.
On Tuesday, the MCX gold May futures contract was 0.01% up at Rs 1,50, 208 per 10 grams. Gold remained steady in the global markets as traders weighed the efforts by the US and Iran to find a solution to a nearly two-month war that has rattled energy supplies and raised inflation risks. The bullion touched around $4,695 an ounce after falling around 0.6% on Monday, Bloomberg reported.
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