MUMBAI– Gold and silver prices retreated on Tuesday as investors booked profits following record highs earlier in the week, even as jewellery sales soared 35–40 percent across India during the Dhanteras festival.
Silver Exchange Traded Funds (ETFs), which had posted exceptional one-year returns of 65–70 percent, also saw sharp corrections as global prices cooled due to improved physical supply and easing safe-haven demand.
Silver had surged past $40 an ounce earlier this month amid supply concerns and peaked above $50 by mid-October. However, prices began falling last week as global trade tensions eased, reducing investor demand for precious metals as safe assets. On October 17, silver prices in the U.S. fell by more than 6 percent, with the decline quickly extending to Indian markets.
According to the India Bullion and Jewellers Association (IBJA), domestic silver prices dropped 7 percent on October 20—from Rs 1,71,275 per kg to Rs 1,60,100 per kg—directly affecting silver ETFs, which mirror spot prices. Data from Ace MF showed single-day declines of up to 7 percent in several silver funds. Analysts said ETFs are now trading near or below fair value, signaling a slowdown in investor inflows after months of heightened activity.
In global markets, gold prices also softened after hitting an all-time high on Monday. Spot gold slipped 0.3 percent to $4,340.29 per ounce, while U.S. gold futures for December delivery edged 0.1 percent lower to $4,356.40 per ounce, as traders locked in profits amid expectations of further rate cuts by the U.S. Federal Reserve.
Meanwhile, festive jewellery demand in India remained robust. The All India Gem & Jewellery Promotion Council reported that 50–60 tonnes of jewellery were sold nationwide over the two days of Dhanteras, generating roughly Rs 85 crore in sales. While overall volume matched last year’s figures, higher prices and stronger consumer sentiment drove a 35–40 percent increase in total value.
“Silver, in particular, has seen a remarkable surge, with sales nearly doubling this season,” the Council noted. “With Dhanteras coinciding with the weekend and followed by Diwali and Bhau Beej, this five-day festive period is expected to deliver record results.”
Industry estimates suggest total jewellery sales could reach 100–120 tonnes, valued between Rs 1 lakh crore and Rs 1.35 lakh crore, making this one of the strongest festive seasons for India’s precious metals market. (Source: IANS)
