9 Feb 2026·Source: The Hindu

5 min

EconomyNEWS

Gold and Silver Prices Experience Volatility After Reaching Record Highs

Precious metals prices cool off after hitting all-time highs in January.

Precious metals, including gold and silver, began 2026 with significant gains, reaching all-time highs in January. However, prices have become volatile, cooling off by almost 10% from recent peaks. Comex Gold surpassed $5,000, reaching $5,626.8 on January 29, before falling to $4,907.5 by month-end, still a 13.3% gain.

Comex Silver reached $121.8 before settling at $85.25, a 20% gain. MCX Gold closed at ₹1,50,849 per 10 grams after hitting ₹1,93,096 on January 29, gaining 8.3% for the month. MCX Silver gained 23.7% to settle at ₹2,91,922 per kilogram.

Comex Gold is expected to trade between $4,400 and $5,650 in the near term. Comex Silver could remain between $75 and $110. Domestic gold prices may fluctuate between ₹1,45,000 and ₹1,90,000, while silver could range from ₹2,40,000 to ₹3,85,000.

Key Facts

Precious metals, including gold and silver, reached all-time highs in January 2026.

Prices have become volatile, cooling off by almost 10% from recent peaks.

Comex Gold reached $5,626.8 on January 29 before falling to $4,907.5 by month-end.

Comex Silver reached $121.8 before settling at $85.25.

MCX Gold closed at ₹1,50,849 per 10 grams after hitting ₹1,93,096 on January 29.

MCX Gold gained 8.3% last month.

MCX Silver gained 23.7% last month to settle at ₹2,91,922 per kilogram.

UPSC Exam Angles

GS Paper 3: Economy - Inflation, Investment, Monetary Policy

Understanding the factors influencing gold and silver prices and their impact on the Indian economy

Potential question types: Statement-based, analytical questions on the role of precious metals in the global economy

Visual Insights

Gold and Silver Price Fluctuations - January 2026

Key statistics on gold and silver price movements in Comex and MCX during January 2026.

Comex Gold Peak: $5,626.8
Comex Gold Gain (January): 13.3%
Comex Silver Peak: $121.8
Comex Silver Gain (January): 20%

More Information

Background

The history of gold and silver as precious metals is deeply intertwined with human civilization. Gold, known for its rarity and resistance to corrosion, has been used as a store of value and a medium of exchange for millennia. Ancient civilizations like Egypt and Mesopotamia used gold extensively in jewelry, religious artifacts, and currency. Silver, while more abundant than gold, also played a significant role in coinage and trade. The value of these metals is influenced by factors like inflation, interest rates, and geopolitical events. Over time, the role of gold and silver in the global economy has evolved. The Bretton Woods system, established after World War II, pegged the U.S. dollar to gold, creating a fixed exchange rate system. This system collapsed in the early 1970s, leading to floating exchange rates and increased volatility in gold and silver prices. Central banks continue to hold gold reserves as a hedge against economic uncertainty. The introduction of derivatives trading has also impacted price discovery and volatility. Modern markets for gold and silver are highly regulated. Exchanges like the Comex (Commodity Exchange) in New York and the MCX (Multi Commodity Exchange) in India provide platforms for trading gold and silver futures and options. These exchanges operate under the oversight of regulatory bodies like the Securities and Exchange Board of India (SEBI) and the Commodity Futures Trading Commission (CFTC) in the United States. These regulations aim to ensure market transparency and prevent manipulation. Globally, gold and silver prices are influenced by various factors, including supply and demand dynamics, geopolitical risks, and macroeconomic conditions. Major gold-producing countries like China, Australia, and Russia play a significant role in the global supply. Demand for gold comes from various sources, including jewelry, investment, and industrial applications. Silver is also used in industrial applications, particularly in electronics and solar panels.

Latest Developments

Recent years have seen increased interest in precious metals as a safe-haven asset due to global economic uncertainties and geopolitical tensions. The COVID-19 pandemic and subsequent economic disruptions led to a surge in gold and silver prices. Central banks' monetary policies, including quantitative easing and low-interest rates, have also contributed to the rise in precious metal prices. The Russia-Ukraine conflict further fueled demand for safe-haven assets. There are ongoing debates about the role of cryptocurrencies like Bitcoin as an alternative store of value. Some investors view Bitcoin as a digital gold, while others remain skeptical due to its volatility and regulatory uncertainties. The rise of ESG (Environmental, Social, and Governance) investing has also impacted the demand for precious metals, with investors increasingly considering the environmental and social impact of gold and silver mining. Looking ahead, the outlook for gold and silver prices remains uncertain. Factors such as inflation, interest rate hikes by central banks, and geopolitical developments will continue to influence prices. Some analysts predict that gold and silver prices will remain elevated due to persistent economic uncertainties, while others anticipate a correction as economic conditions improve. The adoption of new technologies in mining and refining could also impact the supply and prices of precious metals. Challenges in the precious metals market include price volatility, regulatory complexities, and environmental concerns related to mining. Addressing these challenges requires international cooperation, regulatory reforms, and sustainable mining practices. Promoting transparency and responsible sourcing of precious metals is crucial for ensuring the long-term stability and sustainability of the market.

Frequently Asked Questions

1. What key price points and percentages related to gold and silver should I remember for the Prelims exam?

For the Prelims exam, remember that Comex Gold reached $5,626.8 on January 29 before falling to $4,907.5 by month-end, a 13.3% gain. Comex Silver reached $121.8 before settling at $85.25, a 20% gain. MCX Gold closed at ₹1,50,849 per 10 grams after hitting ₹1,93,096 on January 29, gaining 8.3%. MCX Silver gained 23.7%.

Exam Tip

Focus on the percentage gains and peak values for potential MCQ questions.

2. Why have gold and silver prices been volatile recently?

Gold and silver prices have been volatile due to a combination of factors, including global economic uncertainties, geopolitical tensions, and central banks' monetary policies. The cooling off after reaching all-time highs suggests profit-taking and market correction after an initial surge.

3. What is the significance of gold and silver as 'safe haven assets'?

Gold and silver are considered safe-haven assets because they tend to maintain or increase their value during times of economic uncertainty or market turmoil. Investors often turn to these precious metals as a store of value when other investments, such as stocks or bonds, become riskier.

4. How might the recent volatility in gold and silver prices impact the common citizen?

Volatility in gold and silver prices can affect common citizens in several ways. It can impact the price of jewelry, investment decisions related to gold and silver, and overall market sentiment. Fluctuations can also influence inflation expectations and the value of savings.

5. What are the recent developments that caused volatility in gold and silver prices?

Recent developments causing volatility include precious metals reaching all-time highs in January 2026, followed by a price correction of almost 10%. This cooling off period is attributed to factors like profit-taking and adjustments to global economic forecasts.

6. What are the expected trading ranges for Comex Gold and Silver in the near term, according to the article?

As per the article, Comex Gold is expected to trade between $4,400 and $5,650 in the near term. Comex Silver could remain between $75 and $110.

Practice Questions (MCQs)

1. Consider the following statements regarding the recent volatility in gold and silver prices: 1. Comex Gold reached a peak of $5,626.8 in January 2026 before falling to $4,907.5 by the end of the month. 2. MCX Silver gained 23.7% to settle at ₹2,91,922 per kilogram. 3. Comex Silver is expected to trade between $65 and $120 in the near term. Which of the statements given above is/are correct?

A.1 and 2 only
B.2 only
C.1 and 3 only
D.1, 2 and 3

Show Answer

Answer: A

Statement 1 is CORRECT: Comex Gold did reach a peak of $5,626.8 in January 2026 before falling to $4,907.5 by the end of the month, as stated in the news summary. Statement 2 is CORRECT: MCX Silver gained 23.7% to settle at ₹2,91,922 per kilogram, as mentioned in the news summary. Statement 3 is INCORRECT: The news summary states that Comex Silver is expected to trade between $75 and $110, not $65 and $120.

2. In the context of factors influencing gold prices, which of the following is NOT typically considered a major driver?

A.Inflation rates
B.Geopolitical instability
C.Interest rate changes
D.Demand for agricultural products

Show Answer

Answer: D

Options A, B, and C are all well-established factors that influence gold prices. Inflation erodes the value of currency, making gold a safe haven. Geopolitical instability increases demand for safe assets like gold. Interest rate changes affect the opportunity cost of holding gold. Demand for agricultural products is not directly linked to gold prices.

3. Which of the following statements concerning the Bretton Woods system is correct?

A.It established a floating exchange rate system based on market forces.
B.It pegged the U.S. dollar to gold, creating a fixed exchange rate system.
C.It was established before World War I to stabilize international trade.
D.It primarily focused on regulating cryptocurrency markets.

Show Answer

Answer: B

The Bretton Woods system, established after World War II, pegged the U.S. dollar to gold, creating a fixed exchange rate system. This system aimed to stabilize international monetary relations. The system collapsed in the early 1970s, leading to floating exchange rates.