Silver prices continued their sharp decline on Friday, October 23, with futures on the Multi Commodity Exchange (MCX) slipping below ₹2 lakh per kilogram. The metal has now lost nearly half its value from the record high of ₹3,84,632 per kg reached on January 29, 2026.
The December 2026 silver futures contract fell 1.72% to ₹1,96,170 per kg, down ₹3,429 from its previous close. MCX spot silver had closed at ₹2,00,853 per kg, while silver exchange-traded funds (ETFs) declined more than 2.5% during Friday's trading session.
The weakness is not confined to India. International spot silver traded around $54 per ounce, while COMEX futures fell 4.6% in the previous session to settle at $54.7, their lowest level since November 2025.
From the international record high of around $121 an ounce in January, silver has fallen approximately 55%. The metal is also down more than 21% since the beginning of the year.
Several global developments are contributing to the decline, ranging from weakness in technology stocks to rising crude oil prices and changing expectations about US interest rates.
One major factor is the selloff in technology and artificial intelligence-related stocks. As equity markets come under pressure, some investors are liquidating positions in precious metals to cover losses or meet margin requirements elsewhere.
Concerns over the growing cost of artificial intelligence infrastructure have added to market uncertainty.
Crude oil prices are another important factor behind silver's weakness. Brent crude climbed above $114 per barrel on Friday, reaching its highest level in more than five months.
Escalating attacks on Saudi targets by Houthi forces and reports of possible renewed US military strikes against Iran have raised concerns about supply disruptions in the Middle East.
Higher oil prices can push up transportation, manufacturing and energy costs, adding to global inflationary pressures.
For precious metals, this creates a difficult situation. Persistent inflation may discourage central banks from reducing interest rates, limiting the appeal of non-yielding assets such as silver.
Expectations surrounding US Federal Reserve policy are also weighing on silver prices. With crude oil becoming more expensive and the US dollar strengthening, investors are increasingly concerned that interest rates could remain elevated for longer than previously anticipated.
Higher interest rates generally make interest-bearing assets more attractive compared with precious metals, which do not generate regular income. A stronger dollar can also make silver more expensive for investors holding other currencies, potentially weakening international demand.
Silver has suffered a steeper correction than gold because it serves two purposes: it is both a precious metal investment and an important industrial commodity.
Gold is primarily influenced by investment demand, currency movements, interest rates and geopolitical uncertainty. Silver is exposed to these factors but also depends heavily on manufacturing activity.
It is used in electronics, solar panels, electrical equipment and several industrial applications. When investors expect industrial growth to slow, concerns about future silver consumption can intensify selling pressure.
This makes silver more sensitive to economic uncertainty and often more volatile than gold.
India's higher silver import duties, introduced in May, have provided some support to domestic prices by increasing the cost of bringing the metal into the country.
However, import duties cannot fully protect Indian silver prices from a steep international correction.
Domestic rates continue to be influenced by global prices, the rupee-dollar exchange rate, import costs and local demand.
The nearly 50% fall from January's record demonstrates how global market forces can overwhelm the cushioning effect of higher import duties.
Silver's sharp correction may appear to offer an attractive buying opportunity, particularly for investors who missed the earlier rally. However, a steep price decline does not necessarily mean the metal has reached its bottom.
Investors should closely monitor US interest rate expectations, dollar movements, crude oil prices and industrial demand before increasing their exposure.
Those investing through silver ETFs should also consider price volatility, tracking differences and the proportion of their overall portfolio allocated to precious metals.
The key takeaway is that silver is not simply a cheaper alternative to gold. Its industrial exposure makes it more vulnerable to economic slowdowns and sharp price swings.
For long-term investors, gradual accumulation within a diversified portfolio may be more prudent than making a large investment based solely on the recent fall in prices.