Silver Crash: MCX silver futures have experienced a steep decline over the past four trading sessions, losing around Rs 35,300 after the government raised import duties on gold and silver from 9 per cent to 15 per cent. The pressure intensified in Monday’s trading session, where silver futures for July 2026 delivery fell Rs 5,643, or 2.1 per cent, settling at Rs 2,65,949 per kg. This marks a sharp reversal for the white metal, which had touched a record high of Rs 4.39 lakh in January. Since then, prices have corrected nearly 40 per cent, slipping to roughly Rs 2.65 lakh in just four months.
The recent downturn is driven by a mix of weakening demand, global macroeconomic uncertainty, and shifting investor sentiment. Unlike gold, silver has a strong industrial demand base, making it more vulnerable to changes in economic growth expectations.
It is widely used across sectors such as solar energy, semiconductors, electric vehicles, batteries, electronics, AI infrastructure, and other green technologies. As growth expectations soften, demand for these applications tends to slow, weighing heavily on prices.
“At the same time, geopolitical tensions linked to the Iran conflict initially triggered safe-haven buying across precious metals. However, markets later began to focus on the potential impact of prolonged elevated oil prices on global growth momentum. That concern tends to affect industrial metals more heavily than pure defensive assets, causing silver to increasingly trade like an industrial commodity rather than a traditional safe-haven hedge,” Ponmudi R, Founder and CEO of Enrich Money said.
Import Duty Hike Adds Pressure On Domestic Demand
The increase in import duty is expected to further dampen domestic consumption. India, being the world’s largest importer of silver, is particularly sensitive to changes in import costs. Higher duties typically translate into elevated local prices, which can reduce jewellery demand and slow down industrial purchases.
According to Nirpendra Yadav of Bonanza, the revised duty structure raises domestic prices significantly and could weaken demand across both retail and industrial segments. He also noted that sustained geopolitical tensions could keep crude oil prices high, prompting central banks to maintain a hawkish stance. Higher interest rates generally weigh on precious metals since they do not offer yields.
Technical Outlook: Is A Recovery Possible?
From a chart perspective, analysts suggest that silver’s earlier sharp rally is now losing momentum. The metal opened with a gap-down move but continues to hold above the Rs 2,73,000 level.
Immediate resistance is seen in the Rs 2,76,000–Rs 2,77,000 zone. A breakout above this range could help prices recover toward Rs 2,81,000–Rs 2,83,000. On the downside, a fall below Rs 2,71,000 may push prices back into the Rs 2,68,000–Rs 2,67,000 consolidation band. Overall sentiment remains cautious in the near term.
Despite the sharp correction, long-term fundamentals remain supportive. A recent note from Tata Mutual Fund highlighted that global economic slowdown risks could cap silver demand in the medium term, especially if solar installations slow and large speculative positions unwind.
(Disclaimer: This article is meant solely for informational and educational purposes. The views and opinions expressed are those of individual analysts or brokerage firms and do not reflect the stance of Times Now. Readers are advised to consult certified financial experts before making any investment decisions.)