Gold and Silver Price Crash: Silver Drops by 1 Lakh Rupees

The Indian bullion and commodity markets witnessed a historic downturn this Friday as gold and silver prices crashed Importantly. Investors were left stunned as silver prices on the Multi Commodity Exchange (MCX) dropped by more than 1 lakh rupees in a single session. Gold also faced a sharp decline of over 20,000 rupees, while market analysts attribute this sudden slump primarily to heavy profit booking by large-scale investors and institutional players.

The Massive Slump in Silver Prices

On the Multi Commodity Exchange (MCX), silver prices experienced a tsunami-like decline. By the end of the trading session at 11:55 PM,. Silver had fallen by a staggering ₹1,06,092, marking a 26. 53% drop. The price of 1 kg of silver settled at ₹2,93,801. This is a sharp contrast to the previous session where silver had reached a peak of ₹3,99,893, while such a massive correction in a single day is rare in the commodity market.

Gold Prices Lose Their Shine

Gold wasn't immune to the market volatility either. On the MCX, 10 grams of gold saw a reduction of ₹20,323, a 12% drop, bringing the price down to ₹1,49,080. In the previous trading session, gold was trading at ₹1,69,403. Plus, Gold and Silver ETFs also witnessed a decline of up to 23% on Friday, reflecting a broader shift in investor sentiment amidst the profit-booking wave.

Bullion Market Trends

According to the India Bullion and Jewelers Association (IBJA), the physical market also saw significant price cuts. Silver became cheaper by ₹40,638, bringing the price to ₹3,39,350 per kg. Meanwhile, the price of 24-carat gold dropped by ₹9,545, settling at ₹1,65,795 per 10 grams. These rates differ from MCX due to the inclusion of physical handling costs and local taxes.

Why Do MCX and Bullion Rates Differ?

It's important for consumers to understand the difference between MCX and the bullion market. MCX is an online trading platform where prices fluctuate every second based on global demand and supply, similar to the stock market. On the other hand, the bullion market is where you buy physical gold and silver. The physical price includes costs related to transportation, storage, and making charges, which is why the rates are usually higher than the digital trading price.

Essential Tips for Gold Buyers

When purchasing gold, always ensure it's BIS Hallmarked. The hallmark is a guarantee of purity and contains an alphanumeric code that can be verified. On top of that, always cross-check the current market price from reliable sources like the IBJA website before making a purchase. Remember that prices vary Importantly between 24-carat, 22-carat, and 18-carat gold, so choose according to your requirements and budget.

How to Identify Real Silver?

To avoid being cheated with fake silver, you can perform four simple tests. First is the Magnet Test; real silver is non-magnetic and won't stick to a magnet. Second is the Ice Test; place an ice cube on the silver item, and if it melts exceptionally fast, the silver is likely genuine. Third is the Smell Test; real silver is odorless, whereas fakes might smell like copper. Lastly, the Cloth Test involves rubbing the silver with a white cloth; if a black mark appears, it's a sign of authentic silver.

Market Outlook and Investor Advice

While the sudden crash might seem alarming, experts suggest that such corrections are often part of a healthy market cycle after a prolonged rally. For long-term investors, this dip could represent a strategic buying opportunity. However, given the current volatility, it's advised to monitor market trends closely and consult with financial experts before making large investments. The focus remains on how the global economy reacts to these price shifts in the coming week.