SRINAGAR: Gold and silver prices fell sharply on Sunday, hitting lower circuit limits in futures trading ahead of the presentation of the Union Budget 2026–27. Gold futures for April 2, 2026 delivery declined by Rs 9,140, or 6 per cent, to Rs 1,43,205 per 10 grams, while silver futures for March 5, 2026 delivery dropped Rs 17,515, or 6 per cent, to Rs 2,74,410 per kg.
The sharp decline in precious metals also dragged down shares of the Multi Commodity Exchange (MCX), which fell 10 per cent to hit the lower circuit at Rs 2,145.25. The sell-off followed Friday’s steep correction, when both gold and silver recorded their biggest single-day falls. Analysts attributed the downturn to profit booking by investors and a strengthening US dollar.
MCX remained open on February 1 for a special Sunday trading session as Finance Minister Nirmala Sitharaman is scheduled to present the Union Budget 2026.
The fall came after months of strong gains in the bullion market. Gold had surged to Rs 1,83,000 per 10 grams and silver to Rs 4,04,500 per kg on Thursday. By Friday, gold futures for February delivery had slipped to Rs 1.5 lakh per 10 grams, while silver futures for March delivery fell to Rs 3 lakh per kg, marking a decline of over Rs 1 lakh.
Data from Mirae Asset ShareKhan showed that gold’s market capitalisation dropped by nearly $3.5 trillion, while silver lost around $1.5 trillion, taking the combined decline to about $5 trillion.
Despite the recent fall, gold has added nearly $3 trillion and silver about $2 trillion in value since the beginning of the year. Over the past two years, global gold prices have risen by 150 per cent, while silver has gained 326 per cent.
Market experts said the correction was driven by profit booking, heavy liquidation of long positions and a stronger US dollar. Uncertainty surrounding the US Federal Reserve’s leadership also weighed on sentiment, following President Donald Trump’s nomination of Kevin Warsh, known for his tough stance on inflation.
Maneesh Sharma, AVP (commodities and currencies) at Anand Rathi Shares and Stock Brokers, told the Times of India that the US Federal Reserve had maintained status quo on Wednesday, keeping interest rates unchanged after noting improvement in the labour market, while stating that inflation remains elevated and decisions will remain data-dependent.
He added that the sharp movements in precious metals on Friday reflected market speculation that Warsh may be less inclined to cut rates, given his earlier warnings on inflation and recent calls to reduce the Fed’s balance sheet. This, he said, led to a rise in the dollar and bond yields, putting pressure on bullion prices.
