First time ever — Silver rallies to 1,88,500 on MCX; global prices soar past $61 ahead of Fed policy decision

Indian bullion markets witnessed sharp, two-way movement on Tuesday, December 9, as silver soared to fresh record levels while gold dropped steeply ahead of the US Federal Reserve’s policy announcement. The contrasting trend comes at a time when global commodities are reacting to fears of higher bond yields, a stronger dollar and caution ahead of Fed Chair Jerome Powell’s commentary.

Despite the day’s volatility, the big headline belonged to silver - which continued its extraordinary rally both in India and abroad - even as gold slipped under key psychological levels amid nervous trading.

Silver smashes through records at home and abroad

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The standout move of the day came from silver. On MCX, silver futures jumped to Rs 1,88,500 per kg, marking a new all-time high, before cooling slightly later in the session. Market participants said heavy buying interest, coupled with global cues, pushed prices to levels never seen before.

In international trade, silver surged over 3 per cent on COMEX, climbing past $61 per ounce for the first time in history - a milestone that stunned even seasoned metals traders. Analysts say the rally is being driven by strong safe-haven demand, optimism around industrial consumption in 2026, and expectations that the Fed may cut rates sooner than earlier anticipated.

Gold slips Rs 1,000 as investors wait for Fed cues

Gold, meanwhile, moved in the opposite direction. In Delhi’s physical market, the yellow metal fell Rs 1,000 to Rs 1,31,600 per 10g, tracking global weakness and subdued sentiment ahead of the key FOMC meeting.

Traders said the pressure intensified as investors shifted to the sidelines, unwilling to take fresh positions before Powell’s press conference. Bond yields have firmed up ahead of the policy decision, raising the possibility of further volatility if the Fed signals a tighter stance on inflation.

Somil Gandhi of HDFC Securities said gold is currently “trading in a narrow band”, with the market almost entirely fixated on the Fed’s tone. He added that while rate cut expectations are priced in, any surprise from Powell could trigger a swift move in either direction.

Why silver held firm despite gold’s decline?

Unlike gold, silver found strong support from risk-aversion flows, hopes of fresh industrial demand, and talk of a potential 25-basis-point rate cut later in the year. Analysts also pointed to the metal’s dual nature - both precious and industrial - which makes it more sensitive to economic optimism than gold.

Global markets show mixed cues

In overseas trade, spot gold inched up $14.83 to $4,205.57 per ounce, but analysts described it as a “technical bounce” rather than a shift in trend. US Treasury yields rose further, and concerns around inflation kept pressure on bullion through the day. Praveen Singh of Mirae Asset Shekhar said markets are bracing for volatility as the US government prepares to auction $119 billion in bonds this week - a move that could push yields even higher and weigh on gold. The JOLTS job-openings data, due shortly, is another key indicator that traders expect to influence the Fed’s thinking.

Fed policy decision holds the key

With the FOMC outcome just hours away, bullion markets are expected to remain sensitive. A dovish tone from the Fed could send gold higher and keep silver’s rally intact, while a tougher stance on inflation may push the dollar up and trigger further correction in precious metals. For now, traders are watching every statement from the US central bank and preparing for a volatile end to the week.