New Delhi, Feb 2, 2026, 12:05 (IST)
- MCX gold and silver extended losses as volatility stayed high in metals
- Gold and silver ETFs swung sharply after BSE tightened intraday bands
- Steelmakers pointed to Budget 2026’s infrastructure push as a demand tailwind
Silver futures on Multi Commodity Exchange of India hit a 9% lower circuit — the day’s down limit — at ₹2,41,744 per kg on Monday, about 42% below last week’s record ₹4,20,048. Gold April futures fell more than 5% at one point, touching ₹1,40,001 per 10 grams; Ponmudi R, CEO of Enrich Money, said “The ₹1,43,000 – ₹1,45,000 zone continues to act as a strong dynamic support.” (mint)
The whiplash matters because India is one of the world’s biggest bullion markets, and the move is spilling into products that were sold as slow-moving hedges. When prices fall this fast, leverage does the rest: traders get margin calls, sell into weakness and push prices around more.
On BSE, gold and silver exchange-traded funds (ETFs) — metal-linked funds that trade like shares — fell as much as 20% early on Monday before trimming the drop. Axis Silver ETF and Edelweiss Silver ETF both hit their 20% lower circuit, then recovered about 10% by mid-trade. BSE said it based the band on the previous day’s NAV, or net asset value, and limited trades to a ±20% range. (The Economic Times)
Margin changes are adding to the churn. An exchange statement released late Friday showed initial margin on gold futures rising to 8% from 6% for non-heightened risk accounts, while silver margins rise to 15% from 11%, with higher-risk accounts facing steeper requirements, and the hikes linked to CME Group taking effect after Monday’s close. Manoj Kumar Jain of Prithvi Finmart said, “Gold may defend the $4,440 level on closing basis.” (The Economic Times)
Outside India, spot gold was down 3.6% at $4,686.51 an ounce and silver fell 6.7% to $78.96 in early trade. The slide began after Donald Trump nominated Kevin Warsh to lead the Federal Reserve, a move traders read as dollar-positive. (Reuters)
In Sunday trade, MCX gold futures pared steep early losses and ended at ₹1,48,104 per 10 grams, while silver closed at ₹2,65,652 per kg, market data showed. Renisha Chainani at Augmont said the budget did not deliver sector-specific tax cuts or import duty reductions for the gems and jewellery trade. Kaynat Chainwala of Kotak Securities called gold “the favourite hedge against uncertain times and geopolitical tensions.” (The Economic Times)
Retail 24-carat gold was near ₹1,69,300 per 10 grams in major metros and bullion imports attract 6% duty plus 3% GST. (Hindustan Times)
Akshat Garg, head of research and product at Choice Wealth, urged investors to avoid panic exits. “Gold and silver are portfolio hedges, not trading bets,” he said. (mint)
The government is pitching infrastructure spending as the anchor for growth in the new fiscal year. Nirmala Sitharaman said public capital spending, or capex, would rise to ₹12.2 lakh crore in 2026-27 from ₹11.2 lakh crore budgeted for 2025-26, and she earmarked ₹10,000 crore over five years for a container manufacturing scheme. (The Economic Times)
In Bokaro in Jharkhand, steel producers said that push could translate into steadier demand. Priya Ranjan, who heads Bokaro Steel Plant, a unit of Steel Authority of India, called container-manufacturing support “a welcome step”. Ravish Sharma of ESL Steel Limited, owned by Vedanta, pointed to housing and infrastructure as demand drivers, while Harsh Bansal of BMW Industries Limited flagged the need to balance growth with environmental responsibility. (The Times of India)
Investors also dumped the exchange itself. Shares of MCX fell 4% to 2,145 rupees on BSE, extending a three-session drop to about 20%, as the metal rout dented trading sentiment. (The Economic Times)
But the next leg could swing either way. More margin hikes, a stronger dollar or thin liquidity could trigger fresh forced selling, while any pause in the greenback or a flare-up in geopolitical risk could revive safe-haven bids. Steel demand, too, hinges on project execution: slow tenders or delayed spending would take some shine off the budget story.
For now, traders are watching whether higher margins and tighter bands calm the market or simply spread the pain across products. The tape has been ugly, and the market still looks jumpy.
