Silver price plunged ₹1,479 to ₹2.31 lakh per kilogram in futures trade on Tuesday amid escalating geopolitical tensions in West Asia and rising inflation concerns dampening investor sentiment.
On the Multi Commodity Exchange, the white metal for May delivery decreased by ₹1,479, or 0.63 per cent, to ₹2,31,900 per kg in a business turnover of 5,873 lots.
Analysts said silver remained under pressure as traders monitored geopolitical developments in West Asia and their potential impact on global growth and monetary policy.
In global markets, silver futures on the Comex for the May contract fell nearly 1 per cent to $72.41 per ounce in New York.
Silver hovered near $73 per ounce as investors focused on US President Donald Trump’s threat to target Iranian civilian infrastructure unless his demands are met, heightening concerns about the economic impact of a prolonged conflict, Jigar Trivedi, Senior Research Analyst at IndusInd Securities, said.
Trump warned he could “strike Iranian power plants and bridges” if his conditions are not met by Tuesday, including the reopening of the Strait of Hormuz.
Silver has remained under pressure since the conflict began, declining more than 20 per cent, as surging energy prices fuelled inflation fears and increased the likelihood that central banks may delay interest rate cuts or even consider to raise them, Trivedi said.
Markets now expect the US Federal Reserve to keep interest rates unchanged for the remainder of the year, compared with earlier projections of two rate cuts, he added.