Sharp Fall
Silver sinks on COMEX, MCX as firm dollar, margin hikes spark sell-off
This story was originally published at 12:43 IST on 5 February 2026
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NEW DELHI – Prices of silver futures contrcts plunged on Multi Commodity Exchange of India and COMEX on Thursday, erasing recent price gains and triggering fresh volatility in prices. A strong dollar and higher margin requirements by the Chicago Mercantile Exchange prompted heavy liquidation of speculative positions across exchanges.
On Monday, the Chicago Mercantile Exchange increased the margin requirements for gold and silver futures contracts. Silver futures margins for non-heightened risk profiles have been increased to 15% from 11%. For heightened risk profiles, the margins have been raised to 16.5% from 12.1%. This has forced traders to square off leveraged positions and triggered a sell-off in the market.
"The margin requirements being raised by various metals exchanges around the world ... that's just something that's going to kill off some of the speculation," CNBC quoted Sunil Garg, managing director of Lighthouse Canton. "You'd seen a lot of speculator positions build up ... I don't think it's been fully flushed out," he added.
At 1127 IST, the MCX March silver contract plunged nearly 9% to 245,560 rupees per kg, after hitting a low of INR 239,000 earlier in the day. On COMEX, the March silver contract slid over 9% to $76.79 per ounce, after hitting a low of $73.41 earlier in the day.
Kotak Securities expects domestic silver prices to decline further to INR 195,352 per kg if the key support at INR 231,152 is breached. On COMEX, silver prices are likely to fall to $68.75 if prices slide past the immediate support of $72.15.
Despite the sharp fall, analysts see the recent correction as part of a broader consolidation rather than the start of a bearish trend.
"Even as prices of precious metals are now less elevated following the correction, sensitivity to the USD, yield repricing, and uncertainty around Fed policy under new leadership remains high," Investing.com quoted Christopher Wong, FX strategist at OCBC, as saying in a note. He added that the recent precious metals pullback was more of "a normalisation phase rather than a trend reversal." Silver prices are likely to be supported by strong industrial demand for the metal and continued central bank purchases. End
US$1 = INR 90.18
IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT
Reported by Afra Abubacker
Edited by Deepshikha Bhardwaj
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