A further decline in silver prices may be seen in the coming days.Image Credit source: ChatGPT
On Thursday, when silver had crossed the level of Rs 4.20 lakh, a question had arisen in the minds of common investors whether the price of silver would reach the level of Rs 5 lakh in the month of February. It was natural to think so. Because in the month of January itself, an increase of more than Rs 1.60 lakh was seen in the prices of silver. But that day some other script was being written by the US Central Bank Federal Reserve. As soon as the Fed decided not to make any change in the interest rates, the prices of silver from the international market to the country’s MCX collapsed like a wall of sand collapses. Silver prices fell by more than Rs 1.28 lakh from life time high.
However, Fed alone was not the major reason for the fall in silver prices. There was also increase in margin during gold silver ratio and exchange buying and selling. During the trading session on January 30, the gold silver ratio crossed the level of 60. Which was less than 50 before that. On January 26, the figure had reached the level of 43. After which profit booking by investors also started in the early hours. Experts believe that the trend of falling silver prices is not going to stop now. A further decline in silver prices may be seen in the coming days. Some experts believe that it may come down to Rs 2.50 lakh or even below. Let us also tell you what the experts have to say in this matter.
Silver prices will fall further
Or Anuj Gupta, Director of Veld Management, says that further downward trend in silver prices may be seen further. In the coming days, we may see a fall in the price of silver towards Rs 40 thousand from the current level. This means that silver coins can come to the level of Rs 2.50 lakh. He said that the impact of the Fed not cutting interest rates has not been seen yet.
Also, there is no new statement from Trump regarding tariffs. On the other hand, Trump is now preparing to bring Venezuelan oil to the world market. Which is a positive sign for economies around the world. This means that Trump is getting a signal not to impose any new tariff on any new country. Due to which investors may become disillusioned with the safe haven and further decline may be seen in the prices of gold and especially silver.
Gold silver ratio will reach the level of 70
A major reason for the reduction in the prices of gold and silver is the increase in the gold silver ratio. On Thursday, a jump of more than 20 percent was seen in the gold silver ratio and the figure came to the level of 57.420. Which was at the level of 46 and 47. The special thing is that on January 26, the gold silver ratio was trading at the level of 43. Due to this ratio being continuously below 50, there was a continuous increase in the prices of silver. For example, there was a surge on January 30, after which there was a big fall in the price of silver. Anuj Gupta said that in the coming days this ratio can be seen at the level of 70. Due to which the price of silver can be seen at the level of Rs 2.50 lakh.
Sharp rise in dollar index
Experts believe that a sharp rise in the dollar index is expected in the coming days. If we look at the data, there was an increase of about one percent in the dollar index on Friday. Due to which the dollar index crossed the level of 97. Experts believe that in the coming days, further rise may be seen in the dollar index and the figure may be seen at the level of 98 and 99. According to Anuj Gupta, silver prices may have to bear the brunt of the increase in dollar index. Due to which a sharp decline in prices can be seen. He has estimated that a level of 98.50 can be seen in the dollar index in the next few days.
No change in Fed policy rate
There was no change in the policy rate in the recently held Fed policy meeting. The special thing is that during the policy meeting of the Federal Reserve to be held in the months of March and April, only Jerome Powell will be present as the Fed head. However, while announcing the policy rate this time, Powell indicated that people may have to wait a little longer for the rate in the coming days. He said that the economy is strong and the threats regarding employment and inflation are less. Due to which no change has been made in the interest rates. The same situation may be seen in the coming days. This means that further decline in silver prices may be seen. Lowering of interest rates leads to increase in yields, which supports the reduction in gold and silver prices.
Silver became cheaper by Rs 1.28 from record high
Silver prices on the country’s futures market Multi Commodity Exchange fell by more than a record Rs 1.28 lakh on Friday. On Thursday, the price of silver had reached a record level of Rs 4,20,048 per kg. After which the price of silver closed at Rs 2,91,925 per kg on Friday. This means that the price of silver has come down by Rs 1,28,123 from the record high. However, silver had closed at Rs 3,99,893 on Thursday. This means that on Friday the prices decreased by Rs 1,07,968. After almost 15 years, the biggest fall in silver prices was seen in the futures market of the country.