Silver Rate Today: Why Silver Prices Slipped Below ₹4 Lakh per Kg After Record Rally

Silver Rate Today: Why Silver Prices Fell Below ₹4 Lakh per Kg – Kevin Warsh Factor and Key Reasons Explained

Silver prices in India witnessed a sharp correction on Friday as the metal slipped below the psychologically important ₹4 lakh per kilogram level, just days after touching record highs. The sudden fall has raised concerns among investors and sparked intense discussion in commodity markets. Analysts attribute the decline to a combination of global monetary policy speculation, profit booking after a historic rally, and a strengthening U.S. dollar — with the so-called Kevin Warsh factor playing a crucial role.

While silver continues to remain bullish in the long term, short-term volatility has returned in a big way.

Silver Rate Today: Latest Market Update

On the Multi Commodity Exchange (MCX), silver prices corrected sharply, falling from levels above ₹4.2 lakh per kg to around ₹3.7–3.8 lakh per kg, marking a decline of nearly 10–12% from recent peaks.

The drop comes after silver delivered one of its strongest monthly rallies in recent history, outperforming gold and several other commodities.

Market experts say the fall is not a trend reversal but a healthy correction after an overheated rally

What Is the Kevin Warsh Factor?

One of the key triggers behind the sell-off is renewed speculation around U.S. Federal Reserve leadership.

Kevin Warsh, a former Federal Reserve Governor, is reportedly being considered for a future leadership role at the Fed. Warsh is widely seen by markets as less dovish compared to current policymakers. This perception alone was enough to spark nervousness across global asset classes.

Silver Price in India

Why This Matters for Silver

• A less accommodative Fed outlook means higher interest rates for longer
• Higher rates strengthen the U.S. dollar
• A strong dollar usually puts downward pressure on precious metals, including silver

As the dollar index rebounded, silver prices faced immediate selling pressure across global markets.

Profit Booking After Record Rally

Another major reason behind the fall is heavy profit booking.

Silver prices had surged more than 50–70% in a short span, driven by:

• Safe-haven demand
• Strong industrial consumption
• Tight global supply
• Speculative buying in futures markets

After such a steep rise, traders naturally locked in profits, leading to aggressive s

U.S. Dollar Strength Weighs on Silver

Silver is priced globally in U.S. dollars. Any strength in the dollar makes silver more expensive for buyers using other currencies, including the Indian rupee.

Recent developments pushing the dollar higher include:

• Expectations of delayed interest rate cuts
• Strong U.S. economic data
• Fed policy uncertainty due to leadership speculation

This combination reduced global demand for silver in the short term.

Global Commodity Market Sentiment Turns Cautious

Beyond silver, broader commodity markets also witnessed profit-taking.

Gold prices corrected from record levels, equity markets showed volatility, and investors temporarily moved capital into cash and the dollar. This risk-off sentiment reduced safe-haven flows into precious metals.

Silver, being more volatile than gold, reacted more sharply.

Silver’s Strong Fundamentals Remain Intact

Despite the recent fall, analysts remain optimistic about silver’s long-term outlook.

Key Structural Drivers Supporting Silver

• Rising industrial demand from solar panels, EVs, and electronics
• Supply constraints in major silver-producing regions
• Green energy transition boosting silver consumption
• Continued interest from hedge funds and long-term investors

Many experts describe silver as “gold with an industrial engine,” making it more sensitive to economic cycles but also more rewarding over time.

Is This a Buying Opportunity?

Market experts believe the current dip may offer opportunities for long-term investors, but caution against aggressive short-term bets.

Investor Strategy Suggestions

• Long-term investors can consider staggered buying
• Traders should expect high volatility
• Avoid chasing prices during sharp intraday moves
• Keep a close watch on Fed commentary and dollar trends

Silver tends to consolidate after sharp corrections before resuming its trend.

What Happens Next for Silver Prices?

In the near term, silver prices are likely to remain range-bound and volatile, influenced by:

• U.S. Fed policy signals
• Dollar index movement
• Global inflation data
• Industrial demand outlook

A sustained move above ₹4 lakh per kg may take time, but analysts do not rule out fresh highs later in the year if global conditions turn supportive again.

Expert View Summary

• The fall below ₹4 lakh is a correction, not a crash
• Kevin Warsh-related Fed speculation boosted the dollar
• Profit booking amplified the price decline
• Long-term fundamentals remain positive for silver

Conclusion

Silver’s drop below ₹4 lakh per kilogram has grabbed headlines, but the reasons are largely macro-driven and technical in nature. The Kevin Warsh factor, profit booking after a historic rally, and dollar strength combined to cool prices temporarily. For investors, the episode serves as a reminder that silver, while rewarding, is also one of the most volatile commodities.

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