Gold-Silver ETFs Tumble Up to 4%: Spiking Oil & Hawkish Fed Fuel Broad Bullion Sell-Off
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Investors in precious metals witnessed aggressive selling on Monday, September 28, 2026, as domestic Gold and Silver Exchange Traded Funds (ETFs) tumbled sharply in tandem with an international bullion sell-off. Silver ETFs bore the brunt of the downturn, shedding more than 4% in intraday trade, while Gold ETFs dropped up to 3%. The steep decline was triggered by a sudden surge in global crude oil prices following geopolitical developments in the Middle East, reigniting inflation anxieties and reinforcing expectations that the US Federal Reserve will maintain a prolonged monetary tightening cycle, directly diminishing the appeal of non-yielding assets.
Domestic ETF Performance: Silver Funds Hit Hard as ICICI & Tata Lead Declines
Selling momentum swept across leading asset management schemes on Monday afternoon:
Gold ETFs Slip Across Fund Houses: ICICI Prudential Gold ETF led the fall among gold instruments, shedding 3% (down ₹3.87) to trade at ₹125.16. Nippon India ETF Gold BeES slipped 2.86% to ₹120.87, Zerodha Gold ETF lost 2.75% to ₹23.02, Groww Gold ETF dropped 2.79% to ₹14.29, and Tata Gold ETF declined 2.74% to ₹14.22.
Silver ETFs Slide Over 4%: Silver trackers experienced steeper cuts due to industrial demand concerns. Tata Silver ETF plunged 4.05% to ₹21.31, while Nippon India Silver ETF dropped 4.03% to ₹209.98. Groww Silver ETF fell 3.93% to ₹21.52, Zerodha Silver ETF slipped 3.80% to ₹22.30, and Angel One Silver ETF fell 3.65% to ₹8.44.
Global Bullion and MCX Contracts: Spot Prices Face Steep Pullbacks
Weakness in exchange-traded instruments mirrored direct losses in physical and futures contracts globally:
Spot and Futures Drop Internationally: Spot gold fell 2.1% to $4,198.10 per ounce, marking its sharpest single-day retreat since early September, while US gold futures declined 2.1% to $4,231 per ounce. Spot silver slid 3.4% to $62.08 per ounce.
Domestic MCX Corrections: On the Multi Commodity Exchange (MCX), domestic gold futures for October 2026 delivery fell ₹3,214 to ₹147,667 per 10 grams. Meanwhile, silver contracts for September 2026 delivery witnessed a sharper plunge of ₹6,661, dropping to ₹228,035 per kilogram.
Platinum Group Metals Retreat: The sell-off extended beyond primary precious metals, with spot platinum dropping 2.7% to $1,730.78 per ounce and palladium retreating 2.8% to $1,231.46 per ounce.
The Macro Catalyst: Brent Crude Surges Past $107 as Fed Rate Hike Odds Rise
The primary trigger for the bullion downturn stems from escalating energy costs and macroeconomic policy expectations:
Strait of Hormuz Geopolitics: Crude markets surged after US President Donald Trump rejected Iran's proposal to end hostilities and restore full transit across the Strait of Hormuz. In response, international benchmark Brent crude rose 3.29% to $107.75 per barrel, intensifying concerns over imported inflation.
Elevated Fed Rate Projections: Higher energy prices have stoked market fears that the US Federal Reserve will maintain a restrictive policy stance. Having already lifted benchmark interest rates by 25 basis points to the 3.75%–4.00% range earlier this month, the CME FedWatch tool now reflects a 68% probability of another rate hike at the upcoming October meeting.
Dollar Strength and Opportunity Cost: With the US Dollar Index trading near a two-month high, the opportunity cost of holding non-interest-bearing bullion assets like gold and silver has climbed, prompting institutional profit-booking across funds and commodities.
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