Silver Crashes ₹1.60 Lakh in 3 Days, Gold Slides to ₹1.40 Lakh After Budget Shock

India’s bullion market has entered a sharp correction phase just a day after the Union Budget. On February 2, gold and silver prices fell for the third consecutive session, erasing a large part of last week’s historic rally. In the futures market, silver dropped nearly ₹23,000 in a single session, while gold slipped by around ₹7,000, signalling aggressive profit booking by traders and investors.

How Big Is the Fall in Gold and Silver?

The scale of the correction has surprised even seasoned market participants. On the Multi Commodity Exchange (MCX gold silver), silver has fallen by nearly ₹1.60 lakh per kilogram in just three trading sessions. After touching an all-time high of ₹4.01 lakh per kg on January 29, silver is now trading near the ₹2.40–2.41 lakh range.

Gold has followed a similar trajectory. After reaching a record high of ₹1.69 lakh per 10 grams last week, gold price today has retreated to around ₹1.40 lakh. A correction of nearly ₹30,000 in such a short span underscores how quickly sentiment has shifted in the precious metals market.

What Is Happening in the Physical Bullion Market?

The weakness is not limited to futures trading. The physical bullion market has also seen notable declines. According to industry data, silver prices in the spot market dropped by more than ₹29,000 per kg on February 2, while gold prices fell by over ₹6,000 per 10 grams. This shows that the selling pressure is broad-based, affecting both speculative and physical demand.

Why Did Prices Start Falling After the Budget?

In the days leading up to the Budget, gold silver prices had surged to record highs, driven by global uncertainty and strong investment flows. However, once the Budget failed to deliver any major surprise for the bullion sector, traders began locking in profits. This shift from optimism to caution triggered a wave of selling, pushing prices sharply lower.

Market analysts note that such corrections are common after steep rallies. When prices rise too fast, even a small trigger—like post-event profit taking—can lead to a sharp pullback, as seen in the current gold and silver price crash.

Gold Prices Today (February 2, 2026): Purity-Wise Rates

After the sharp correction, gold price today in India has cooled across all purity levels. According to data released by the India Bullion and Jewellers Association (IBJA), 24-carat gold slipped to ₹1,42,270 per 10 grams, reflecting the impact of sustained selling pressure. Lower-purity gold, which is widely used for jewellery, has also become noticeably cheaper, offering some relief to buyers tracking the gold rate fall.

City-Wise Gold Rates Across India

A look at city-wise gold prices shows that the correction has been uniform across major markets. From Delhi and Jaipur in the north to Mumbai and Chennai in the west and south, prices remain closely aligned, with only marginal differences due to local taxes and logistics. This indicates that the bullion market correction is nationwide rather than region-specific.

Visual Snapshot: Gold & Silver Price Correction

Why This Data Matters for Investors

For investors tracking gold investment and silver investment, the latest data highlights how quickly sentiment can change after major economic events. City-wise uniformity suggests that the correction is driven by macro factors rather than local demand shifts. This makes the next few sessions crucial for understanding whether the current fall is a temporary pullback or the start of a deeper consolidation.

Why Are Gold and Silver Prices Falling?

The sharp gold and silver price fall is primarily driven by aggressive profit booking. Over the past few weeks, precious metals had rallied to record highs, attracting short-term traders and speculative money. Once prices peaked and the Union Budget passed without any major positive trigger for bullion, investors rushed to lock in profits. This sudden wave of selling created heavy pressure on the bullion market, leading to a steep correction.

Another key factor is weakening physical demand. After prices touched all-time highs, jewellery buying slowed sharply, while concerns over industrial demand—especially for silver—added to market nervousness. When physical demand fails to support elevated prices, even a small shift in sentiment can result in a sharp decline, as seen in the current gold silver crash.

How CME Margin Hike Is Adding Pressure

According to market experts, the Chicago Mercantile Exchange (CME) has increased margin requirements for gold and silver contracts. Gold margins have been raised from 6% to 8%, while silver margins were increased from 11% to 15%. This change has intensified selling pressure in global commodity markets, including India.

In commodity trading, investors are required to deposit only a portion of the contract value as margin money. When margins are raised, traders must bring in additional funds. Those unable to do so are forced to reduce positions, leading to large-scale selling. As many traders liquidate positions simultaneously, gold and silver prices come under sustained pressure.

What Should Investors Do Now?

For long-term investors, experts advise against panic selling. Precious metals are still considered a safe-haven investment, especially during periods of global uncertainty. Instead of exiting completely, investors may consider a staggered approach—buying in small quantities during corrections rather than making lump-sum investments.

Jewellery buyers, on the other hand, may see the current decline as an opportunity. However, analysts caution that volatility could persist in the short term. Tracking global cues, margin changes, and demand trends will be crucial before making any major gold investment or silver investment decisions.

Two Things to Remember While Buying Gold

1. Buy certified gold only: Always ensure that the gold you purchase carries a BIS hallmark. This certification confirms purity and improves resale value, protecting buyers from quality-related risks.

2. Cross-check prices: Before purchasing, verify the gold rate today from reliable sources such as IBJA. Gold prices vary by purity—24 carat, 22 carat, and 18 carat—so clarity on billing details is essential.

How to Identify Genuine Silver

Magnet test: Pure silver does not stick to a magnet. If it does, the item may be fake.

Ice test: Place ice on silver. Genuine silver melts ice quickly due to its high thermal conductivity.

Smell test: Real silver has no odor. A copper-like smell may indicate impurities.

Cloth test: Rubbing silver on a white cloth may leave a black mark, which often indicates authenticity.

FAQs: Gold and Silver Price Correction

Why did gold and silver prices fall after the Budget?

The decline was triggered by profit booking after record highs, combined with weak physical demand and higher global margin requirements.

Is this correction temporary or long-term?

Most analysts view the fall as a short-term correction. Long-term fundamentals for precious metals remain intact.

Should investors sell gold now?

Experts generally advise against panic selling. Long-term investors may consider holding or buying gradually during dips.

Is silver riskier than gold?

Yes, silver investment tends to be more volatile than gold, but it also offers higher return potential during strong demand cycles.

Why are IBJA prices important?

IBJA rates are widely used as benchmark prices by banks, jewellers, and financial institutions across India.