Domestic bullion markets witnessed a steep fall on Friday, with gold prices tumbling close to ₹5,000 per 10 grams during intraday trade to hit a low of ₹1,21,895. This marked one of the sharpest single-day drops in recent months. Silver registered an even deeper slide, declining by ₹8,700 per kg to touch ₹1,53,729.
The slump in Indian precious metal rates tracked the sharp downturn in international markets, where gold slipped by nearly $127 per troy ounce, while silver was trading around $50.21 on COMEX, down 5.56%.
Why Bullion Prices Crashed
Analysts attributed the abrupt decline in gold and silver to two major developments in the United States:
1) Hawkish U.S. Federal Reserve Commentary
Fresh remarks from Federal Reserve officials signaled a more conservative stance on interest rate reductions, dampening expectations of a December rate cut. Lower interest rates typically support non-interest-bearing assets like gold, and reduced hopes of monetary easing triggered selling pressure.
Market expectations for a 25 bps cut in December have fallen sharply—traders now assign it a 49% probability, down from 64% earlier this week, as per the CME FedWatch Tool.
2) End of U.S. Government Shutdown
The conclusion of a record 43-day U.S. government shutdown eased safe-haven demand for precious metals. While some crucial economic data may still face delays—particularly October unemployment figures—the immediate resolution has softened risk aversion in global markets, weighing further on gold and silver.
Analyst View
Anuj Gupta, Director at Ya Wealth Global Research, said investor appetite for precious metals has weakened due to diminishing rate-cut hopes and reduced safe-haven appeal. He expects bullion to remain under pressure in the near term.
Despite today’s decline, gold and silver have been among 2025’s top-performing asset classes:
| Metal | YTD Gains (2025) |
|---|---|
| Gold | Up 60% or ₹45,700 per 10g |
| Silver | Up 78% or ₹67,700 per kg |
In November so far, gold has gained 1% (₹1,262), while silver has risen 4.6% (₹6,845 per kg).
Trading Strategy: Sell on Rise
Gupta recommends a sell-on-rise approach in the current market:
| Metal | Sell Level | Stop Loss | Target Price |
|---|---|---|---|
| Gold | ₹1,27,000 | ₹1,31,000 | ₹1,20,000 |
| Silver | ₹1,63,000 | ₹1,66,000 | ₹1,55,000 |
Outlook
With uncertainty around U.S. economic policy and investors reassessing safe-haven positions, bullion may extend its corrective phase. Market watchers suggest keeping track of upcoming U.S. economic releases and further commentary from the Federal Reserve, which could shape price movements in the weeks ahead.
