- Silver futures on MCX dropped 4% to Rs 305,753 per kg amid easing geopolitical tensions
- Silver prices fell nearly Rs 30,000 per kg from their all-time high on MCX
- Silver ETFs experienced sharper declines, with Tata Silver ETF down nearly 24%
Silver futures weakened sharply on the Multi-Commodity Exchange (MCX) on Thursday as easing geopolitical tensions reduced safe-haven demand, while a firmer US dollar added further pressure on prices.
MCX silver slipped 4% to Rs 305,753 per kilogram, after global risk sentiment improved following US President Donald Trump's decision to step back from fresh tariff threats and proposals to annex Greenland by force. From its all-time high, silver prices on MCX are now down by nearly Rs 30,000 per kg.
The correction was even more pronounced in silver exchange-traded funds (ETFs). Tata Silver ETF plunged nearly 24% to Rs 25.56, while Edelweiss Silver ETF and Mirae Asset Silver ETF dropped 22% each. 360 ONE Silver ETF declined 21%, and Nippon India Silver ETF fell 20% on the NSE. The sharp fall in ETFs reflects the broader pullback in precious metals, which had seen a strong rally earlier.
What triggered the fall?
Geopolitical tensions eased after Trump said he had reached the outlines of a deal with NATO regarding Greenland's future. “Based upon this understanding, I will not be imposing the tariffs that were scheduled to go into effect on February 1st,” Trump wrote on Truth Social after meeting NATO Secretary General Mark Rutte in Davos. He did not disclose details of the agreement.
Trump also ruled out the use of military force to take control of Greenland. “I won't do that… I don't have to use force, I don't want to use force, I won't use force,” he said, calming markets that had earlier been rattled by his aggressive rhetoric.
What lies ahead?
According to ANZ commodity strategist Soni Kumari, Trump's reversal helped ease geopolitical stress, leading to a retracement in precious metal prices. “Reversal of comments by the US President was one factor that eased geopolitical tensions, and so we see a retracement in prices,” she told Reuters. Kumari added that ANZ continues to prefer gold over silver, citing central bank support and gold's relative resilience compared with more industrially exposed precious metals.
Meanwhile, Goldman Sachs has raised its December 2026 gold price forecast to $5,400 per ounce from $4,900, citing continued buying by private sector investors seeking protection against global policy risks. The brokerage also expects Western gold ETF holdings to rise, supported by expectations that the US Federal Reserve could cut interest rates by 50 basis points in 2026, which would further bolster demand for the yellow metal.
Read More: Oil Steadies With US Push For Greenland And Supplies In Focus
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