Gold, silver ETFs tumble up to 4% as precious metals melt on rising yields

Mon Sep 28 2026

Since gold ETFs and silver ETFs are designed to track the price of the underlying metal, a decline in the bullion prices weighs on them.

Gold and silver exchange-traded funds (ETFs) declined sharply in Monday's trade amid steep selling seen in precious metals. A spike in bond yields and the increased possibility of US Federal Reserve rate hikes pulled gold and silver prices in domestic and global markets.

Since gold ETFs and silver ETFs are designed to track the price of the underlying metal, a decline in the bullion prices weighs on them.

MCX Gold October futures lost over ₹4,000 per 10 grams or 2.72 per cent to ₹1,46,784, while the Silver December futures were down ₹8,500 per 1 kg or 3.61 per cent at ₹2,26,230 in the afternoon trade.

Ashish Rajodiya, head – commodities, PL Capital, said the pressure is coming from a sharp US Treasury bond selloff — the 10-year yield at 5.13 per cent, its highest since 2007, and the 30-year at 5.44 per cent, its highest since 2004 — as CME FedWatch data shows markets now pricing a 68.1% probability of a 25-basis-point Federal Reserve rate hike at the October 28 meeting, up from just 31.9 per cent odds of holding steady, on the back of strong economic data and energy-driven inflation concerns tied to the ongoing US-Iran standoff over the Strait of Hormuz.

"Elevated crude prices, rather than boosting gold's safe-haven appeal as they typically would during geopolitical stress, are instead reinforcing the case for further Fed tightening, feeding a stronger dollar and steeper yield curve that both work against non-yielding bullion," he said.

Against this backdrop, silver ETFs tumbled over 4 per cent, data available on NSE shows. HDFC Silver ETF was down 4.25 per cent to ₹209.35, while Silver Bees was down 3.91 per cent, Tata Silver ETF lost 3.92 per cent, SBI Silver ETF shed 3.97 per cent, and Groww Silver ETF dipped 3.75 per cent. All silver ETFs lost 3.5-4 per cent.

In tandem with the decline in precious metals, the decline in gold ETFs was lower but still elevated at over 3 per cent. Axis Gold ETF was down 3.3 per cent, Gold Bees lost 2.83 per cent, and ICICI Prudential Gold ETF declined 2.98 per cent. Other gold ETFs were also down over 2.4-3 per cent at the time of writing this report.

The sell-off in gold and silver ETFs reflects profit-taking and a reduction in risk exposure amid a stronger dollar, elevated oil prices and expectations of higher-for-longer US interest rates, said Nirpendra Yadav, senior research analyst at Bonanza.

"In the near term, precious metals could remain under pressure, but a stabilization in the dollar and yields, along with renewed ETF inflows, could provide a base for recovery. Investors should therefore watch ETF flows and key technical support levels closely before assessing whether the current decline is a deeper trend reversal or a healthy correction," Yadav added.

From a technical perspective, gold’s $4,100 level and recent lows in silver will be important support zones; holding these levels could help prices stabilize and potentially trigger a recovery, he said.

Gold & silver outlook

Persistent weakness in bullion prices could further pressurise the gold and silver ETFs. Ponmudi R, CEO, Enrich Money, said the bias has turned negative for gold, with a sustained move above ₹150,000 needed to stabilise the setup. A decisive break below ₹148,000 could expose the metal to further downside toward ₹146,000, he cautioned.

As for silver, a sustained move above ₹232,000 is needed to stabilise the structure. "A decisive break below ₹228,000 could expose the metal to further downside toward ₹224,000."

Source: https://www.business-standard.com