Silver prices in India drop 0.5% to ₹2,73,266/kg on dollar strength and Fed concerns

Silver prices on the Multi Commodity Exchange of India fell 0.5% to ₹2,73,266 per kilogram as a strengthening U.S. dollar and rising crude oil prices weighed on the precious metal. The decline came despite silver posting a weekly gain of 0.4%, reflecting the tug-of-war between safe-haven demand and macroeconomic headwinds that have characterized commodity markets in recent sessions.

The stronger dollar makes dollar-denominated commodities like silver more expensive for holders of other currencies, dampening international demand. Simultaneously, rising oil prices have reignited inflation concerns among traders, fueling speculation that the U.S. Federal Reserve may maintain its hawkish stance on interest rates for longer than previously anticipated. Higher interest rates typically reduce the appeal of non-yielding assets like silver and gold, as investors can earn returns from fixed-income instruments instead.

Geopolitical tensions continue to provide a floor under precious metal prices, preventing a sharper selloff despite the unfavorable macro backdrop. For traders, the key levels to monitor will be whether silver can hold above the ₹2,70,000 psychological support level on the MCX, or if further dollar strength pushes prices toward deeper correction territory. The interplay between inflation data, Fed commentary, and geopolitical developments will likely dictate near-term direction for silver and other precious metals.