Gold & Silver ETFs Fall as Dollar Rises: What Should Investors Do?
Gold & Silver ETFs Fall as Dollar Rises: What Should Investors Do?
Gold and silver ETFs plunge as the dollar strengthens; experts urge caution but keep a bullish long-term view.
Gold and silver ETFs tumbled after a strong January rally, as the dollar strengthened and traders booked profits. Spot gold slipped 5.4% to Rs 1.66 lakh per 10 grams, while silver dropped 10.7% to Rs 3.39 lakh per kilogram. The move came as the greenback rose about 0.3% and traders weighed the potential for a hawkish Federal Reserve, pressuring non-interest-bearing assets like gold and silver. The price correction also followed a rapid ascent, with some investors using the rally to lock in gains.
Nippon India Silver ETF slid 18.6% to Rs 286.48, ICICI Prudential Silver ETF fell 20.14%, and DSP Silver also weakened as broader sentiment soured on metal prices. ETFs tracking the precious metals mirrored the spot-price declines as investors reassessed risk in a volatile backdrop.
Analysts note the pullback could be a technical correction after a brisk run and expect near-term volatility. While the near term looks challenging, the longer-term case for gold and silver remains intact with demand from investors, industry use, and central-bank accumulation helping to support prices. Investors are advised to proceed with caution, diversify holdings, and consider dips as potential entry points rather than chasing prices.
