Indian Silver ETFs Plunge Over 3% Amid Rising Fed Rate Hike Bets
Silver exchange-traded funds (ETFs) in India plummeted over 3% on September 11, as silver prices continued their downward trend in international markets. The SBI Silver ETF dropped 3.2% to Rs 221.77, while ICICI Prudential Silver ETF and Nippon India Silver ETF both fell 3.1% to Rs 226.16 and Rs 216.59 respectively.
The decline in silver prices was due to a sharp repricing of US interest-rate expectations, with stronger-than-expected producer inflation and surging crude prices adding to concerns that the Federal Reserve could raise interest rates next week. This typically poses a headwind to precious metals, which do not offer interest income.
Gold ETFs also traded lower, though their declines were smaller, at around 1% each for SBI Gold ETF and ICICI Prudential Gold ETF. Spot gold prices remained relatively stable at $4,312 an ounce after falling nearly 2% on Thursday.