Silver Price Slumps 2% on MCX Amid Rising Crude Prices and Ongoing US Monetary Policy Uncertainty

Silver Prices Decline 2% Amid Geopolitical Uncertainty

Key Figures:

• ₹2,54,367: MCX Silver rate per kg (down 1.95%)
• ₹1,56,655: MCX Gold rate per 10 gram (down 1%)
• $80.88: Spot silver price per ounce (up 0.4%)
• $5,017.53: Spot gold price per ounce (unchanged)
• $2,049.50: Platinum price per ounce (up 0.9%)
• $1,556.50: Palladium price per ounce (up 0.3%)

Market Analysis

Read also: Gold and Silver Prices Decline Amid Strengthening Dollar and Inflation Concerns

The silver market experienced a decline of 2% on Monday, March 16, as the dollar softened and US Treasury yields decreased. However, the precious metal's price was caught between two opposing forces: a weaker greenback and lower interest rates on one hand, and high oil prices and inflation worries on the other.

In the international market, spot silver rose 0.4% to $80.88 an ounce, while spot gold remained range-bound at $5,017.53 an ounce. US gold futures for April delivery declined 0.8% to $5,020.90.

Key Drivers

A key reason for the decline in silver and gold prices was the rise in energy prices, which waned hopes of a US Federal Reserve rate cut. Oil prices remained above $100 a barrel due to the ongoing US-Israeli war against Iran, which has led to concerns over damage to energy infrastructure and the prolonged closure of the Strait of Hormuz.

Read also: Gold and Silver Prices in India: A Review of Current Rates Across Major Cities

Technical Outlook

Renisha Chainani, Head - Research at Augmont, believes that silver remains firmly supported around $80 (₹260,000) and is continuing its upward momentum, with the next upside target seen around $95 (₹285,000). On the downside, strong support is placed near $75 (₹255,000).

For gold, Chainani predicts that prices will move towards $5,250 (₹163,500) and $5,300 (₹165,000) in the near term, with strong support seen around the $5,000 (₹158,500) level, which is likely to act as a key buying zone on any corrective dips.