India's precious metals market closed October with a bruising sell-off, as silver crashed by about forty-five thousand rupees per kilogram during the month and gold fell to its lowest level in seven months.
The decline, which gathered pace through the final week of the month, has wiped out a large part of the spectacular rally that had carried both metals to record highs earlier in the year, and it has left jewellers, investors and households facing a very different market from the one they saw at the start of October.
The sharpest falls came on Friday, October 30, the last trading session of the month. Silver for December delivery on the Multi Commodity Exchange plunged by ten thousand five hundred and seventy-seven rupees per kilogram in a single session, breaching the one lakh eighty thousand rupee mark and touching an intraday low of one lakh seventy-nine thousand six hundred rupees per kilogram.
Silver was last seen trading at similar levels in December, and the day's fall widened its losses for October to nearly forty-five thousand rupees per kilogram, putting the metal on course for its steepest monthly decline of 2026.
Gold moved in the same direction, though less violently. The yellow metal fell by a further four thousand three hundred and forty-seven rupees per ten grams on Friday, touching an intraday low of one lakh thirty-eight thousand two hundred and forty-nine rupees, its lowest level since late March.
At the time of reporting, gold was trading at around one lakh thirty-eight thousand four hundred and eighty-one rupees per ten grams, while silver was quoted at about one lakh seventy-nine thousand five hundred and twenty-seven rupees per kilogram. During October as a whole, gold declined by ten thousand seven hundred and eighty-seven rupees per ten grams, following a fall of five thousand four hundred rupees in September.
Measured from their peaks, the scale of the correction is striking. Silver has fallen by about fifty-seven per cent from its record high of four lakh twenty thousand and forty-eight rupees per kilogram, surrendering more than half of the gains built up during an uninterrupted rally in 2025. Gold has retreated by more than forty-two thousand rupees per ten grams from its record peak of one lakh eighty thousand seven hundred and seventy-nine rupees.
For investors who bought near the top, the losses are severe; for buyers waiting on the sidelines, the market suddenly looks very different.
The immediate trigger was a set of inflation figures from the United States. The Personal Consumption Expenditures price index, the Federal Reserve's preferred gauge of inflation, rose by 0.5 per cent month on month in September, its biggest monthly increase since March. Annual inflation accelerated to 3.6 per cent, while core inflation, which strips out volatile food and energy prices, climbed to 3.1 per cent year on year.
The numbers hardened expectations that the American central bank may raise interest rates again, with traders now pricing in roughly a seventy-five per cent probability of a hike in December, according to the CME FedWatch Tool.
Higher interest rates are traditionally bad news for precious metals, which pay no interest and therefore look less attractive when bond yields rise. Rising crude oil prices have added to the pressure, by feeding inflation expectations and reinforcing the case for tighter monetary policy. Brent crude traded near one hundred and twelve dollars a barrel during the sell-off, and the combination of expensive energy and sticky inflation has weighed on metals across the board.
The October slide was the culmination of a rough fortnight rather than a single bad day. On Thursday, October 22, silver futures on the MCX had already plunged by eight thousand five hundred and ninety-three rupees per kilogram to two lakh five hundred and seventy-five rupees, their lowest level in seven months, while gold fell by two thousand three hundred rupees per ten grams to one lakh forty-three thousand six hundred rupees.
International prices told the same story: spot gold closed the week ending October 23 at four thousand and twenty-one dollars an ounce, down 3.6 per cent for the week, its steepest weekly decline in more than four months, while spot silver fell to fifty-three dollars and ninety cents an ounce.
Silver has suffered more than gold throughout the correction, and market analysts say there are good reasons for that. Silver is both an investment metal and an industrial metal, used in electronics, solar panels and a range of manufacturing processes. When interest-rate expectations rise and industrial demand looks uncertain, silver is hit from both sides at once, which helps explain why its percentage losses have dwarfed gold's.
The gold-silver ratio, a measure watched closely by traders, has moved in a direction that suggests further underperformance for the white metal, according to market reports.
India's own investment landscape has added a twist. Large mutual fund houses suspended fresh investments in gold and silver exchange-traded fund schemes from October 16, just ahead of the Dussehra and Diwali buying season, amid concerns that festive inflows could translate into physical gold imports and put further pressure on the rupee.
The freeze came despite strong appetite earlier in the year: Indian gold ETFs had attracted net inflows of forty-five thousand nine hundred and twenty-six crore rupees between January and September 2026, with more than one lakh forty thousand new accounts opened.
For ordinary buyers, the correction cuts both ways. Jewellers report that lower prices can revive footfall after a period in which record prices had discouraged purchases, particularly for weddings and festivals. But households that bought gold as a store of value at peak prices, or investors who entered silver funds during the rally, now face uncomfortable decisions about whether to hold on, average down or exit.
Financial advisers generally caution against panic selling, while noting that precious metals remain volatile and that a single month's fall does not by itself signal where prices will settle.
What happens next will depend largely on the American data and the Federal Reserve. If inflation cools and the case for a December hike weakens, metals could stabilise or recover part of their losses. If inflation stays hot and oil prices remain elevated, the pressure could continue, and analysts warn that silver, with its dual exposure to investment and industrial demand, would remain the more vulnerable of the two.
For now, October will be remembered as the month in which one of the great precious metals rallies of recent years ran into a wall of inflation data, and the market is still working out how hard the landing will be.
(Reporting based on market reports from DSIJ, Business Today and HDFC Sky.)