Gold and Silver ETFs Decline Amid Geopolitical Tensions

Original: Gold, silver ETFs slip up to 4% as Trump signals tougher action on Iran. What’s next for investors?

The Economic Times•Apr 2, 20263 min

In a Nutshell

Gold and silver exchange-traded funds (ETFs) faced significant declines on Thursday, with HDFC Silver ETF dropping nearly 4%. The downturn is attributed to rising Brent crude prices and geopolitical tensions following statements from former U.S. President Donald Trump regarding Iran. Investors are advised to approach these assets as long-term holdings.

Key Points

01HDFC Silver ETF fell by 4%, reaching Rs 217.37.
02Gold ETFs, including Kotak Gold ETF, dropped by 3%.
03Brent crude prices surged over 4%, impacting precious metal prices.
04Investors are encouraged to view gold and silver as long-term investments.
05Market volatility is expected due to fluctuations in oil prices and the dollar index.

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Full Summary

On Thursday, gold and silver ETFs experienced notable declines, with the HDFC Silver ETF dropping by 4% to a low of Rs 217.37, down from Rs 225.62 the previous day. Other silver ETFs, including those from Nippon India and SBI, also fell by 3% each, while Kotak Gold ETF decreased by 3% to Rs 121.12. The decline in precious metals is linked to a rise in Brent crude prices, which surged over 4%, alongside increases in the 10-year U.S. Treasury yield and the dollar index, creating downward pressure on gold prices. Spot silver prices fell by 3% to $72.95 per ounce, while MCX silver futures for May 2026 dropped 5.5% to Rs 2,29,888 per kg. Gold futures for June 2026 also fell by 1.6% to Rs 1,51,161 per 10 grams. Analysts suggest that investors should consider booking profits during rallies and refrain from opening new long positions, especially in light of the ongoing U.S.-Iran tensions and upcoming long weekends.

Key Figures

4%

Decline in HDFC Silver ETF

3%

Decline in Kotak Gold ETF

4%

Surge in Brent crude prices

5.5%

Decline in MCX silver futures

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Why It Matters

The decline in gold and silver prices could affect investors' portfolios, especially those relying on these assets for inflation hedging.

Who is affected

Investors in gold and silver ETFs, particularly those looking for short-term gains.

What to know

Investors should consider booking profits on rallies and avoid initiating new long positions until market conditions stabilize.

FAQ

The decline is primarily due to rising Brent crude prices and geopolitical tensions following statements from former U.S. President Donald Trump regarding Iran.

Investors are advised to view these assets as long-term diversification tools rather than short-term trading assets.

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