- Gold and silver prices have fallen from record highs but remain elevated ahead of the Budget
- MCX gold futures dropped from Rs 1.80 lakh to near Rs 1.69 lakh per 10 grams after a swift correction
- Silver prices eased mildly from Rs 4.08 lakh to Rs 4.05 lakh per kg but stay above January levels
Gold and silver prices in India have slipped from the record peaks hit earlier this week, but levels remain high enough to keep buyers glued to every move ahead of the Union Budget.
The pullback has cooled the frenzy without denting interest among investors who see dips as possible entry points.
MCX gold February futures are trading near Rs 1.69 lakh per 10 grams after touching an intraday lifetime high of around Rs 1.80 lakh on January 29. The swift correction dragged some contracts sharply lower before prices steadied. Silver has seen a milder retreat. MCX March silver futures have eased from around Rs 4.08 lakh per kg to roughly Rs 4.05 lakh, but remain far above levels seen at the start of January.
Same Pattern Abroad
Global markets show a similar pattern. International gold futures, which surged above 5,600 dollars per ounce, have corrected by high single digit to low double digit percentages but continue to trade well above early January levels. Silver, after touching the high teens to around 120 dollars per ounce, has also cooled as traders booked profits. The moves have widened the gap between Indian and global prices, something gold buyers are watching closely.
India's dependence on imported bullion magnifies every price swing. The country imports almost all the gold it consumes and more than 80 percent of its silver.
A significant share of foreign exchange outflows last year went toward gold and silver purchases. Rising imports have widened the trade deficit and helped push the rupee to a record low this month, factors that could influence price behaviour after the Budget.
Demand patterns are shifting. Jewellery buying has softened under the weight of higher prices, but investment demand is rising sharply. Gold ETF assets nearly tripled in 2025, with net inflows estimated at over Rs 400 billion as investors looked for safety amid weak equity market returns. Silver ETFs have grown even faster as buyers search for higher momentum beyond gold.
The Big Budget Buzz
Speculation over import duties has added to the suspense. Markets remember 2012 and 2013, when the government sharply raised duties as the rupee weakened. Last year's Budget cut gold and silver duties from about 15 percent to roughly 6 percent to curb smuggling and narrow the gap with global prices. Industry groups now want further cuts, while some policymakers are reportedly weighing the pressure that high imports place on the rupee.
Jewellers say customers are tracking the Budget closely.
Jaipur Jewellers Association member Manish Khunteta says relief in customs duty would benefit buyers and sellers as elevated prices squeeze household budgets. Experts have also called for raising the Rs 2 lakh PAN threshold for jewellery purchases, noting that even routine wedding buys now cross that limit.
For now, the basic customs duty on gold remains around 6 percent, with no official announcement of a change. The Budget on February 1 could tilt the market either way, and bullion prices are expected to react sharply when trading resumes on Monday.
