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Chandigarh: The global precious metals market witnessed a dramatic turnaround on Thursday, with gold and silver prices plunging sharply after touching historic highs, rattling investors who had flocked to these assets as traditional safe havens. The sudden correction erased substantial gains within hours, underscoring the heightened volatility gripping global financial markets.
Silver, which had recently surged to an all-time high of ₹4.20 lakh per kilogram in India and $121 per ounce in international markets, bore the brunt of the sell-off. The metal fell nearly 12 per cent, marking one of its steepest single-day declines in recent times. Gold prices also slipped significantly, dropping by almost $500 per ounce to around $5,100, snapping a strong upward momentum that had been building over weeks.
Market experts attribute this abrupt reversal to a broader risk-off sentiment triggered by a sharp downturn in US technology and artificial intelligence (AI) stocks. The fall was led by a steep decline in Microsoft’s shares, following growing concerns about excessive AI-related capital expenditure and signs of slowing growth in its cloud business. The sell-off in tech stocks spilt over into other asset classes, prompting investors to book profits in precious metals as well.
Commenting on the sharp correction, Pankaj Arora, National President of the All India Jewellers and Gourmet Federation, said the recent surge in silver prices had become unsustainable. “Silver prices jumped by ₹25,000 to ₹40,000 within just fifteen days, which is straight-line growth and cannot be maintained for long,” he said. Arora pointed out that while global fundamentals for silver remain strong—especially after the United States classified silver as a critical mineral and China imposed restrictions on its exports—the excessive volatility is being driven mainly by speculative paper trading on global exchanges.
He highlighted the extreme price swings in the domestic market, noting that Indian silver prices fluctuated wildly from ₹1.85 lakh to ₹1.65 lakh in a single day. Advising investors to remain patient, Arora said that while silver could potentially reach ₹7 lakh per kilogram over the next few years, interim corrections could see prices dip to around ₹2.5 lakh before stabilising.
Echoing similar concerns, he said the sharp movements in gold and silver reflect the deep uncertainty prevailing across global asset classes. “When there is no clarity about the direction of the global economy, capital tends to move erratically between equities, bonds, and precious metals,” he explained.
Arora observed that although Indian equity markets have also witnessed some correction, they have shown relative resilience compared to global peers. He added that investors are now closely watching the upcoming Union Budget, hoping it will provide clearer signals on economic growth, fiscal policy, and market direction.
“These kinds of moments suggest only one thing—there is massive volatility across global markets and across asset classes, be it precious metals, equities, or debt. Such phases usually emerge when uncertainty is at its peak, and no one has a clear idea of what lies ahead,” Shah remarked. The sudden crash in precious metals serves as a reminder that even traditional safe-haven assets are not immune to sharp corrections during global financial turbulence, as investors continue to navigate an increasingly uncertain economic landscape.
