Silver prices in India witnessed sharp selling pressure on Friday as a stronger US dollar, rising Treasury yields and mounting inflation concerns weighed on sentiment in the precious metals market. Investors also remained cautious ahead of the meeting between US President Donald Trump and Chinese President Xi Jinping later in the day. Gold was also under pressure.
Selling intensified across bullion counters, with MCX silver prices plunging ₹11,644, or 4%, to ₹2,79,458 per kg. Gold prices also fell, as MCX gold fell ₹1,623, or 1%, to ₹1,60,355 per 10 grams.
In the global market, both gold and silver prices moved lower amid fading hopes of near-term US Federal Reserve rate cuts following stronger-than-expected inflation data and persistent geopolitical uncertainty linked to the Iran conflict.
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MCX silver prices experienced a significant drop due to a stronger US dollar, rising Treasury yields, and increased inflation concerns. Investors also adopted a cautious stance ahead of the meeting between US President Donald Trump and Chinese President Xi Jinping.
Silver prices are being pressured by a stronger US dollar, which makes bullion more expensive for holders of other currencies, and rising US Treasury yields, which increase the opportunity cost of holding precious metals. Inflation concerns and geopolitical uncertainty also contribute to the downward pressure.
The Indian government increased import duties on gold and silver to 15% from 6%. This move aimed to discourage overseas purchases and reduce pressure on foreign exchange reserves, leading to initial price increases followed by profit booking.
According to analysts, silver has broken above resistance levels at $83 and $85, with the next targets set at $90 and $92. However, prices can fluctuate, and the long-term trend depends on a broad recovery in industrial demand.
A falling gold-silver ratio, such as the recent drop below 55, indicates that silver is outperforming gold. Historically, a ratio closer to 50 suggests stronger silver performance relative to gold.
Spot silver declined 3.1% to $80.93 per ounce, while spot gold dropped 0.8% to $4,613.19 per ounce by 0205 GMT, marking its fourth straight session of losses and its lowest level since May 6. US gold futures for June delivery also slipped 1.4% to $4,619. Bullion prices have remained under pressure this week, with gold declining more than 2% so far.
Dollar strength, inflation worries and oil prices pressure bullion
Fresh US economic data showed wholesale inflation accelerated at its fastest pace since 2022 in April, while consumer inflation recorded its sharpest increase since 2023. The inflation readings pushed the US dollar and bond yields higher, reducing the appeal of non-interest-bearing assets such as gold and silver.
The dollar index has gained more than 1% this week, making bullion more expensive for holders of other currencies. At the same time, benchmark 10-year US Treasury yields climbed close to one-year highs, increasing the opportunity cost of holding precious metals.
Meanwhile, concerns surrounding the Iran conflict continued to keep energy markets volatile. The Strait of Hormuz, a key global energy shipping route, remains effectively shut, prolonging supply worries and keeping inflation fears elevated. Oil prices headed for weekly gains, with West Texas Intermediate crude approaching $102 per barrel.
Markets are also closely tracking diplomatic developments between the US and China. Trump and Xi are scheduled to conclude a two-day state visit later on Friday, with discussions focusing on trade, geopolitical tensions and Taiwan-related issues.
Adding to the domestic market volatility, India earlier this week increased import duties on gold and silver to 15% from 6% to discourage overseas bullion purchases and reduce pressure on foreign exchange reserves.
Under the revised structure, the government raised the basic customs duty on several gold and silver import categories to 10% from 5%, while the 5% Agriculture Infrastructure and Development Cess (AIDC) remains unchanged, taking the effective import tax to 15%.
Gold, Silver Outlook
According to Renisha Chainani, Head – Research at Augmont, President Trump and President Xi convened in Beijing (May 13–15), with trade policy, Taiwan, artificial intelligence, and Iran-related tensions dominating the agenda. Xi reiterated that trade wars produce no net winners, characterizing the bilateral economic relationship as fundamentally cooperative and mutually beneficial, she noted.
Chainani, furthermore, stated that U.S. April Producer Prices posted their sharpest monthly increase since early 2022, while CPI accelerated to 3.8% — the highest reading since May 2023 — largely driven by energy cost pressures tied to the Iran conflict. Markets have fully unwound expectations for any 2026 Fed rate cut, pushing gold lower to approximately $4700, while silver maintained its footing near $90, added the expert.
Technically, she said, “Gold remains range-bound between $4,650 and $4,780, with no directional resolution. Silver has achieved the target of $90, next resistance is $92.”
Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions.
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