Mumbai — Silver prices fell sharply on India’s Multi Commodity Exchange on Monday, dropping more than Rs 7,000 per kilogram amid a broader sell-off in precious metals as rising oil prices and global inflation concerns pressured the market.
During midday trading, the December silver futures contract on the MCX was at Rs 227,494 per kilogram, down Rs 7,202, or 3.07%, from its previous close of Rs 234,696.
The decline came as higher crude oil prices fueled concerns about renewed inflationary pressure and raised expectations that the U.S. Federal Reserve could keep interest rates elevated for longer or consider additional monetary tightening.
Higher interest rates and Treasury yields generally weigh on precious metals because assets such as silver and gold do not generate interest income. A stronger U.S. dollar can also make dollar-denominated commodities more expensive for buyers using other currencies.
Market analysts placed immediate resistance for MCX silver at Rs 232,000 to Rs 233,000 per kilogram, followed by Rs 236,000 to Rs 237,000. Support was seen at Rs 227,000 to Rs 228,000, followed by Rs 223,000 to Rs 224,000.
Analysts said the relative strength index, or RSI, stood at 41.12 and remained below its signal line, indicating weakening momentum.
Silver was also under pressure in international markets. COMEX silver opened at $64.66 and was trading near $62.40, down 3.72%.
The metal slipped below the $63.50-to-$64 range, which analysts said could now act as resistance, while prices were testing support around $61.50 to $62.
Market watchers said silver remained weaker than gold during the session, with further resistance seen at $65.50 to $66 and additional support at $59.50 to $60.
Silver was also trading below its 20-, 50-, 100- and 200-day exponential moving averages, while its RSI continued to weaken.
Meanwhile, the U.S. dollar opened at Rs 95.80 against the Indian rupee and traded just below the Rs 96 level. Analysts identified resistance at Rs 96 to Rs 96.10, followed by Rs 96.40 to Rs 96.50, while support was seen at Rs 95.70 to Rs 95.80 and then Rs 95.40 to Rs 95.50.
The dollar-rupee pair remained above key short-term moving averages, with its RSI at 59.51, indicating a mild bias toward further rupee weakness. (Source: IANS)
