Precious Metals Freefall In The Week: Gold Drops ₹5,938 to 1-Month Low, Silver Collapses ₹17,705 to 11-Month Low
Summarized by AI; it may make mistakes. Check important info
Summarized by AI; it may make mistakes. Check important info
Heavy selling hit global bullion markets in the week ending October 23, pulling Multi Commodity Exchange (MCX) gold down 3.99% (-₹5,938 per 10g) to ₹1,42,805 and COMEX gold down 4.05% (-$170.50/oz) to $4,038.50/oz.
Silver posted far sharper losses across both exchanges. MCX silver plunged 8.30% (-₹17,705 per kg) to close at ₹1,95,604, while COMEX silver fell 6.94% (-$4.02/oz) to $53.93/oz—leaving international silver over 55% below its January record peak of $121/oz.
Commodity / Exchange | October 16 Close | October 23 Close | Absolute Fall | Percentage Fall | Historical Level Hit |
MCX Gold (per 10g) | ₹1,48,743 | ₹1,42,805 | -₹5,938 | -3.99% | 1-Month Low |
COMEX Gold (per oz) | $4,209.00 | $4,038.50 | -$170.50 | -4.05% | 1-Month Low |
MCX Silver (per kg) | ₹2,13,309 | ₹195,604 | -₹17,705 | -8.30% | Multi-Month Low |
COMEX Silver (per oz) | $57.95 | $53.93 | -$4.02 | -6.94% | 11-Month Low |
Spiking Crude Oil and Hawkish Interest Rate Outlook Drag Bullion
Rising energy costs sparked the broad liquidation in precious metals. Brent crude oil surged past $114 per barrel following Middle East supply disruptions, reigniting global inflation worries. Bond markets reacted by pricing in a prolonged period of elevated interest rates from the US Federal Reserve. Because gold and silver pay no yield, higher bond yields directly increase the opportunity cost of holding physical bullion.
The US Dollar Index strengthened alongside rate expectations. A stronger greenback raised purchasing costs for non-dollar investors, crimping physical demand in major importing hubs like India. Equity markets compounded the damage; a steep drop in technology shares triggered cross-asset margin calls, forcing funds to liquidate liquid bullion holdings to raise capital.
Why Industrial Exposure Caused Silver to Crash Harder Than Gold
While gold sits roughly 21% off its peak, silver has collapsed over 55%. The divergence comes down to fundamental differences in end-use demand. Gold functions as a central bank reserve asset and monetary hedge. Silver operates as a hybrid metal, drawing roughly 50% of its consumption from industrial sectors
like solar panel production, consumer electronics, and electric vehicle manufacturing.
Slowing industrial manufacturing activity and cuts in technology capital expenditure hit silver consumption directly. Gold faces no such industrial demand drag. Silver’s smaller market size also magnifies price swings; forced liquidations in leveraged futures markets triggered stop-loss orders, accelerating its slide past key technical support levels.
