Is Something Brewing in Silver? Jewelers Raise Concerns Over MCX Rally, Issue Reaches Finance Minister

Silver continues to hit new highs this year, trading at around ₹3.34 lakh per kilogram on the Multi Commodity Exchange (MCX). The sharp rally has raised concerns among domestic jewellers and bullion traders.

After a brief dip on Thursday, silver prices bounced back on Friday. By 8 PM, MCX silver contracts were up over ₹6,000, trading near ₹3.34 lakh per kg. The All India Jewellers & Goldsmith Federation (AIJGF) expressed worry over the sudden surge, claiming that silver deals were being executed at roughly ₹40,000 per kg above prevailing market rates. A letter highlighting these concerns was sent to Finance Minister Nirmala Sitharaman, signed by AIJGF President Pankaj Arora and General Secretary Nitin Kedia.

The federation linked this “sudden and sharp disruption” to rumours about an increase in import duties on silver. An MCX spokesperson said the volatility is influenced by global geopolitical events, as well as domestic market factors. Prices on MCX reflect currency fluctuations, import duties, and local market trends. The exchange affirmed that it closely monitors trading and complies with all regulations.

Recovery After Drop
On Thursday, gold and silver ETFs saw an initial drop of around 20%, narrowing to roughly 11% by the end of the day. March silver contracts on MCX fell 2.7%, while February gold contracts dropped 0.8%.

Global Market Outlook
Friday saw a strong rebound in precious metals, driven by geopolitical tensions, a weaker U.S. dollar, and expectations of an interest rate cut by the Federal Reserve, whose next meeting is scheduled for 27 January. Internationally, spot gold rose 0.5% to $4,961.57 per ounce, and February U.S. gold futures gained 1.1% to $4,964.60 per ounce. Spot silver increased 0.9% to $97.01 per ounce, reaching a record high of $97.44 earlier in the session.

Goldman Sachs has revised its 2026 year-end gold forecast from $4,900 to $5,400 per ounce, citing structural demand shifts from private investors and central banks in emerging markets. Gold returned 64% in 2025 and has gained 11% so far in 2026, while silver has delivered nearly 40% returns this year.