Gold, silver prices have witnessed sharp fall: What's the reason?
What's the story
The precious metals market has witnessed a major correction, with both gold and silver prices falling sharply on the Multi Commodity Exchange (MCX). The fall comes after a massive rally in recent weeks. Gold prices of 24K on MCX, which had recently hit an all-time high of ₹1,32,294 per 10g, have now fallen by some 3% to ₹1,25,957 per 10g.
Market correction
Silver prices plummet over 8%
Silver prices have witnessed an even sharper fall, plummeting over 8% from ₹1,70,415 per kg to ₹1,53,929 per kg. The correction is largely attributed to a wave of profit-taking triggered by certain external market factors that temporarily eased geopolitical and economic anxieties. Market experts have termed this correction as a healthy development after an extraordinary rally in recent months.
Market analysis
Gold, silver's strategic case remains compelling
Ajay Bagga, a banking and market expert, said that Friday's price fall was a "necessary tactical retreat" driven by short-term sentiment shifts and natural profit-taking after a historic rally. He attributed the sudden pullback to US President Donald Trump's more conciliatory stance on threatened high tariffs on China, which eased global tensions. Despite the correction, Bagga emphasized that the strategic case for gold and silver remains highly compelling due to structural factors such as global de-dollarization and persistent supply deficits in silver.
Investment advice
Correction part of normal market cycle
Bagga advised investors to see the correction as an opportunity to build or add to long-term positions. He also noted that silver's outlook is even stronger than gold's due to its dual role as a precious metal and an important industrial metal. Ajay Kedia, Founder and Director of Kedia Commodities, echoed similar sentiments by claiming that the sudden fall was on expected lines after a parabolic rise in the last two months.