Silver prices have dropped below ₹2 lakh per kg on the Multi Commodity Exchange (MCX) for the first time since December 2025, marking a sharp decline amid broader market pressures. On Friday, the metal fell to ₹1,92,800 per kg after losing around ₹6,800 in a single session. This decline extends a losing streak driven by rising crude oil prices, persistent inflation concerns, and expectations of tighter US monetary policy. Silver has now fallen 22.5% from its August 2026 peak of ₹2,48,800 per kg and over 50% from its January record high of ₹4,20,048 per kg.
The sell-off in silver comes as Brent crude approached $115 per barrel, nearing a four-year high, due to escalating tensions in the Middle East. Higher energy prices have revived inflation fears, potentially prolonging restrictive monetary policies. US consumer and producer inflation data released last week exceeded expectations, strengthening the case for a Federal Reserve rate hike in December. The probability of a rate hike at the October 27-28 meeting stood at just 9%, according to CME’s FedWatch Tool.
Analysts remain divided on silver’s outlook. Rajeev Sharan, Head of Research at Brickwork Ratings, noted that higher energy costs and tighter monetary policy are weighing on precious metals, with silver facing additional pressure from its industrial uses. Meanwhile, Renisha Chainani, Chief Research Officer at Augmont, suggested that silver could decline further towards ₹1,80,000-₹1,85,000 over the next 10-15 days before potentially rebounding 10-15%. She identified $50-$55 as a potential support and accumulation zone for the metal.
Gold has also weakened, declining 0.29% on Friday while hovering near a three-month low of ₹1.40 lakh per 10 grams. Both gold and silver are heading toward a second consecutive monthly decline. Investors are now weighing whether the sharp correction offers a buying opportunity or if further declines are likely. The next moves in crude oil, US inflation data, and Federal Reserve expectations will be crucial in determining silver’s next direction.