Gold, Silver ETFs fall up to 3.6%: Why precious metals are slipping as US Fed rate fears mount

Gold and silver ETFs dropped up to 3.6% on Monday as rising crude oil prices sparked inflation fears, raising expectations of further US Fed rate hikes.

Edited By: Joy Pillai

Published: September 28, 2026, 4:59 PM IST

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Gold, Silver ETFs fall up to 3.6%: Why precious metals are slipping as US Fed rate fears mount | Image: AI

Gold, Silver ETFs Fall Up To 3.6%: Gold and silver ETFs witnessed a sharp fall on Monday due to a global sell-off in precious metals, as rising crude oil prices fueled inflation concerns and raised expectations of further US Fed rate hikes. Silver ETFs witnessed a fall of 3.6 per cent, while the yellow metal ETFs plunged over 2 per cent on Monday. The weakness in the precious metals came alongside a broader risk-off mood in the country’s equities. During early morning trading, the Sensex crashed 975 points, or 1.3 per cent, to 72,920, while the Nifty fell by 310 points to 22,830 at 12:10 pm.

SBI Silver ETF Biggest Loser

SBI Silver ETF emerged as the biggest loser among the ETFs of precious metals. It fell 3.59 percent to Rs 216.23. Tata Silver Exchange Traded Fund fell by 3.51 percent to Rs 21.43, Nippon India Silver ETF plunged by 3.57 percent to Rs 210.99. ICICI Prudential Silver ETF slipped 3.44 percent at Rs 220.49.

Gold ETFs Traded In Red

Talking about Gold ETFs, it also traded in red.

The massive losses reflected a sharp decline in international bullion markets.

Domestic commodities also mirrored the same pressure. MCX silver futures. With September 2026 delivery, fell by Rs 6,661 to Rs 2,28,035/kg, while October 2026 gold futures plunged Rs 3,214 to Rs 1,47,667/ 10 grams.

Surging Crude Oil Prices Stoke Inflation Concerns As Strait Of Hormuz Standoff Continues

It is to be noted that the major sell-off in gold and silver came after crude oil prices witnessed a surge following US President Trump’s rejection of an Iranian peace proposal and reopening the Strait of Hormuz. Brent crude witnessed a surge of USD3.43, or 3.29 percent, to USD107.75/barrel.

US Fed Rate Hike Fears Mount

Notably, rising inflation fears are driving fears of another US Fed rate hike. Traders see a 68 percent probability of a rate hike in October, following a recent 25-basis-point hike to 3.75–4 per cent.

The weakness not only impacted gold and silver, spot platinum also plunged 2.7 percent to USD1,730.78 an ounce. Palladium fell by 2.8 percent to USD1,231.46. The decline reflected the broad-based sell-off across precious metals.