Gold and silver prices in India surged Thursday as speculators created fresh positions amid firm spot demand. National rates for 24-karat gold hit ₹1,56,050 per 10 grams, while silver climbed to ₹2,43,630 per kg, according to the Bullions website.
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The recovery follows a volatile period and is supported by a significant regulatory shift on domestic exchanges. Both the Multi Commodity Exchange (MCX) and the National Stock Exchange (NSE) officially withdrew additional margin requirements today, lowering the capital barrier for traders and injecting much-needed liquidity into the bullion market.
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Speculative Rebound: Speculators Create Fresh Positions
Speculators drove the morning rally by creating fresh long positions, tracking strong trends in international markets. Spot gold rose nearly 1% to $4,918.64 per ounce globally, while spot silver gained 3% to hit 75.60 per ounce. This “dip buying” emerged after recent corrections, despite a firm US dollar.
Meanwhile, safe-haven demand remains supported by escalating tensions between the US and Iran. Although nuclear talks in Geneva showed “guiding principles,” the presence of the USS Gerald R. Ford in the Middle East continues to rattle markets. In fact, central bank buying continues to provide a “hard floor” for prices whenever a dip occurs.
Regional Rate Variations: Chennai and Hyderabad Lead
The southern markets continue to record the highest prices in the country. Chennai leads the major metros with a peak 24K rate of ₹1,56,220 per 10 grams, while Hyderabad and Bengaluru followed closely. This maintains a distinct price gap between the southern hubs and the northern capital.
Next, Mumbai and Kolkata followed a similar trend, retailing 24-karat gold at approximately ₹1,55,760 and ₹1,55,560 respectively. In the national capital, Delhi, the 24-karat rate stood slightly lower at ₹1,55,490. Therefore, a buyer in Chennai is paying roughly ₹730 more per 10 grams than a buyer in Delhi today.
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MCX and NSE Margin Rollback: A Liquidity Boost
In a major move for futures traders, both the MCX and NSE withdrew additional margins effective Thursday, February 19. This includes the removal of the 3% additional margin on gold and the 7% additional margin on silver that was introduced earlier this month to curb “out of control” volatility.
The withdrawal comes as bullion volatility has moderated compared to the “spectacular crash” seen in late January. Therefore, capital requirements for traders have dropped, which is expected to improve intraday trading volumes. In fact, the MCX share price rose over 3% today as investors reacted to the potential for increased fee income from higher volumes.
Reality Check
спекулянты (Speculators) are creating fresh positions on “firm spot demand.” Still, the broader sentiment remains cautious due to hawkish signals from the US Federal Reserve. Minutes from the latest FOMC meeting revealed a split, with some officials favoring a pause in rate cuts. Therefore, while today is a “green day,” the “higher-for-longer” interest rate narrative could still cap gains by making the US dollar more attractive than non-yielding gold.
The Loopholes
The “margin withdrawal” is framed as a response to stabilized volatility. In fact, it also allows for a return of the very speculative leverage that triggered the January price spike. Therefore, the “liquidity boost” could quickly turn back into “extreme volatility” if geopolitical news from the Strait of Hormuz takes a turn for the worse. Still, for retail jewellers, the immediate effect is a more stable supply as futures hedging becomes cheaper.
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What This Means for You
If you are planning a purchase for the ongoing wedding season, realize that the “bottom” may have passed for now. First, compare your local jeweller’s rate against the national average; southern buyers should be particularly vigilant about “making charge” markups. Then, watch the US PCE inflation data due later this week, as it will dictate the Fed’s next move.
Finally, realize that the removal of additional margins makes Gold and Silver ETFs slightly more attractive as the underlying futures market becomes more efficient. You should consult with an advisor before making aggressive speculative bets, as the market is still nearly 18% below its January all-time highs. Before buying, check if your local retailer has updated their rates following the 11:00 AM IST market reset.
What’s Next
The impact of the margin withdrawal will be fully reflected in the MCX closing volumes this evening. Then, attention will shift to the US GDP data release on Friday. Finally, a new set of “Long-term Bull Run” targets for silver are expected from major brokerages by early next week as industrial demand for AI chips continues to surge.
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