Silver price tumble stalls festive buying despite government import boost

Silver's 55% plunge from a record ₹4.2 lakh per kg to around ₹1.93 lakh has not revived festive demand for coins and bars, even as jewellery sales stay steadier. The fall in MCX futures on 23 Oct 2026 follows a stronger US dollar, higher bond yields and worries over industrial use. The government eased import rules on 22 Oct, approving permits for about 6,500 tonnes of silver over six months – almost 93% of the 7,000‑tonne volume imported in 2025 – after tightening rules earlier in the year and raising import duties on gold and silver from 6% to 15% on 13 May 2026. Demand for investment silver has collapsed, but jewellery remains resilient. Surendra Mehta, national secretary of the India Bullion and Jewellers Association, said shoppers are scared after prices fell sharply and higher living costs leave little disposable income. Titan’s Shaya brand saw festive sales grow 25‑30% YoY, far below its 80‑100% target, mainly because coin sales, which made up about 30% of last season’s revenue, vanished. The brand is offering a flat 40% discount plus an extra 10% for buying two items, a temporary move slated to end after Diwali, and is expanding lower‑priced SKUs to under ₹2,000. Silver Emporium’s managing director Rahul Mehta noted that higher prices are pushing buyers toward personal jewellery instead of bars or coins. At Gargi, P.N. Gadgil & Sons, CFO‑COO Aditya Modak observed a slowdown in plain silver ornaments and utensils, while jewellery sales stay on par with last year. Smaller designers like Tribe Amrapali and Angara report growth, citing design appeal and price points below ₹2 lakh per kg as draws.

Context

Silver is traditionally bought for puja items and gifts during Diwali, but volatile prices make consumers cautious, leading them to favor gold‑linked jewellery or cheaper designs instead of pure silver investments.