Gold rates in India pulled back mildly on Saturday, September 13, after hitting back-to-back record highs. In the current times, a 24 carat gold in 10 grams is near Rs 1.20 lakh, while the silver rate has reached Rs 1.33 lakh levels.
So far in September, silver has outperformed gold with nearly 6% gains, while the latter surged by 5%.
Year-to-date, gold and silver prices continue to outperform the Indian stock market due to their back-to-back record rallies. Gold is up by 42%. while silver surpasses with an eye-popping 48% gain in 2025 so far.
However, there is one key factor that investors are not aware of, and that is the ratio between gold and silver. This gold-silver ratio is pivotal for making investment decisions, especially before US Federal Reserve policy scheduled for next week.
But first, let us understand gold and silver performance.
Gold Rates In India:
In India, 10 grams of gold touched its new all-time high of Rs 111,280 in 24 carat on September 12. Not just that now, the 22 carat gold price is also above Rs 1 lakh. 10 grams in 22 carat hit its record high of Rs 102,000 on September 12 as well.
On September 13, prices have pulled back slightly, but still precious metal continues to give returns. From September 1 to September 13, both 22 carat and 24 carat gold rates have zoomed by 5%. YTD, these precious metals have surged by 42-43%. 10 grams of 24 carat alone has seen Rs 33,280 jump in its price YTD.
Silver Rates In India:
There was a time when silver was just around Rs 97,000 per 1Kg six months ago. On September 13, silver has recorded a new lifetime high of Rs 133,000 per 1Kg. In some southern cities like Chennai, Hyderabad and Kerala, silver is at Rs 143,000 per 1kg.
Silver has skyrocketed by 48% to 49% YTD.
What Is Driving Gold & Silver Prices?
As per Rahul Kalantri, VP Commodities, Mehta Equities, the rally was supported by persistent expectations of looser US monetary policy, as inflation remained steady in line with forecasts, producer prices unexpectedly fell, and jobless claims hit a four-year peak, highlighting labour market weakness. Markets already priced in a 25 basis point Federal Reserve rate cut, with speculation growing over a potential larger reduction. Safe-haven demand was further bolstered by geopolitical uncertainties, including US efforts to push G7 allies to impose higher tariffs on India and China over Russian crude purchases, intensified Middle East conflict, and Poland intercepting Russian drones amid attacks in western Ukraine.
Interestingly, the gains are almost on parallel lines since August 2025. In fact, over the past three months, the gold-silver ratio has ranged from 84 to 86.
Explaining in detail, Ross Maxwell, Global Strategy Lead at VT Markets, told GoodReturns, “the gold-silver average ratio is about 50-60, so today’s level of around 84 means that relatively speaking, gold is expensive to buy relative to silver, or that silver is undervalued.”
At MCX, gold and silver touched their new historic highs of Rs 109,656 per 10 grams and Rs 129,392 per 1kg on September 12.
What Does Gold-Silver Ratio Mean and why is it important?
Decoding the two phenomenal commodities and their co-relation, Charles Schwab in its report earlier said, the gold/silver ratio is a reading of just what it implies: the ratio of the price of one ounce of gold to the price of one ounce of silver. Put another way, this ratio indicates how many ounces of silver it would take to buy an ounce of gold.
Further, this global research agency added, while both metal prices are affected by inflation and supply and demand, gold is sensitive to market uncertainty in a way that silver is not. That’s why looking at this ratio-to determine how investors are valuing the two metals, relatively-can be a barometer for overall investor sentiment.
“Focusing on the ratio, rather than spot prices only, tells traders whether fear or optimism is in control of market sentiment. That makes it a critical signal in times of economic and political upheaval,” it said.
Should You Buy Gold Or Silver Ahead Of Fed Policy?
“Whether or not it is the right time to buy gold, we need to consider what our aims are. If the goal is wealth preservation and stability, gold remains a strong safe-haven asset, supported by central bank demand, low real interest rates, and geopolitical risks. However, at such a high GSR, the potential for outsized gains in gold may be limited in the near term,” said Maxwell to GoodReturns.
On the other hand, he added, “silver appears more attractive from a relative value perspective, especially if the ratio trends back toward its historical norms. Silver can also benefit from industrial demand in solar panels, electronics, and electric vehicles, which adds a growth component alongside its role as a precious metal.”
“A reasonable approach in the current situation could be to buy or hold some gold for stability but increase exposure and weight slightly to silver for potential upside. This way you balance the safety of gold with the opportunity for growth in silver and a return to the historical average gold-silver ratio,” he lastly said.
An expectation of 25 basis points rate cut from Fed is one of the fuelling factor in both gold and silver prices. The FOMC meeting, chaired by Jerome Powell, will begin from September 16th and its outcome will be declared on September 17.