Silver prices hit Rs 2 lakh/kg in India as buying frenzy spikes

Silver prices hit Rs 2 lakh/kg in India as buying frenzy spikes

When Jitendra Kumar, a jeweller from Mumbai watched silver rates surge past the Moneycontrol headline, the whole market felt the tremor. By , the white metal had breached the Rs 1.90 lakh per kilogram barrier, and a day later the price in Chennai, Hyderabad and Kerala touched the Rs 2.00 lakh mark. The surge was not a flash‑in‑the‑pan; it echoed a broader buying spree that started in early October and was amplified by the approach of Dhanteras 2025 and the wedding season.

Why silver exploded in October 2025

According to data compiled by India Today, a Rs 6,000 per kilogram jump occurred between 13 and 14 October, pushing the metal into uncharted territory for Indian investors. The price of a 10‑gram silver coin, a traditional Dhanteras gift, climbed from Rs 1,100 in 2024 to roughly Rs 1,950 – a 98 percent year‑on‑year rise.

Bloomberg, cited by both Moneycontrol and GoodReturns, highlighted that silver outperformed gold in 2025, gaining about 75 percent versus gold’s 55‑60 percent uplift. The industrial demand story is key: solar photovoltaic (PV) cell production, which absorbs roughly 10 percent of global silver output, kept the metal in a deficit despite ample vault reserves.

  • Jan 1 2025: Rs 79.376 per gram (minimum)
  • Average 2025 price: Rs 99.969 per gram
  • Oct 16 2025 peak: Rs 149.84 per gram (≈ Rs 2.00 lakh/kg)
  • Oct 19 2025 correction: Rs 94,000 per kilogram

Market reaction and retail behaviour

The rapid climb triggered a mixed response from the retail front. Jitendra Kumar told India Today that “people buying for weddings are still in, but many are waiting for a correction after the festival rush.” He added that several traders in Bandra had paused new orders ahead of Dhanteras, fearing a price dip.

Meanwhile, the Reserve Bank of India (RBI) hinted at a tighter monetary stance in its latest policy statement, a move that historically cools precious‑metal demand. By Sunday, Oct 19, the price slid by Rs 2,000 per kilogram, offering a sigh of relief to bargain‑hunters gearing up for the wedding season.

Expert analysis: Is the rally sustainable?

Expert analysis: Is the rally sustainable?

Analysts at GoodReturns warned that the post‑Diwali period could see further profit‑taking, especially after the RBI’s dovish signals and a stronger U.S. dollar that pushed spot silver down to $31.40 per troy ounce on global markets.

However, long‑term bullishness remains anchored in the industrial narrative. The same Bloomberg report noted that while “global vault stocks are healthy, mining output is lagging behind the accelerating demand from renewable‑energy projects,” suggesting that any price dip may be temporary.

What the next week could bring

All eyes are on the upcoming Federal Reserve meeting minutes and the U.S. inflation report due later this month. Historically, a softer U.S. CPI number lifts precious‑metal sentiment, while a hawkish Fed tone pulls investors back into riskier assets.

Domestic traders also keep a watchful ear on the RBI’s next policy decision. Should the central bank opt for a rate hike to curb inflation, the immediate effect could be a further dip in silver, pressuring Indian retailers to source inventory at lower prices before the next festive surge.

Key takeaways for buyers

Key takeaways for buyers

If you’re planning to buy silver for a wedding or as a Dhanteras gift, the current landscape offers a two‑stage strategy:

  1. Lock in a modest amount now, as the market may still be correcting.
  2. Monitor the RBI and Fed announcements – a clear signal could herald the next rally, letting you add to your holdings at a relative discount.

Frequently Asked Questions

How does the recent price correction affect wedding planners?

The correction, which shaved roughly Rs 2,000 per kilogram off silver rates, gives wedding planners a short‑term price cushion. They can now secure silver jewellery and décor at lower costs, which may translate into modest savings for clients, especially in regions like Mumbai and Delhi where silver is a popular wedding metal.

What triggered the sharp rise to Rs 2 lakh per kilogram?

A confluence of factors – a global supply deficit, booming demand from photovoltaic solar cell manufacturers, and robust domestic buying ahead of Dhanteras and the wedding season – pushed the metal to historic highs. Internationally, a weaker U.S. dollar earlier in the month also added upward pressure.

Will the Federal Reserve’s upcoming minutes influence Indian silver prices?

Yes. The Fed’s stance on U.S. interest rates directly impacts the dollar’s strength. A hawkish tone usually strengthens the dollar, making silver more expensive in rupee terms, while a dovish note can ease pressure. Indian investors watch these cues closely, especially during festival buying cycles.

How does industrial demand compare with investment demand for silver?

Industrial demand now accounts for about 60 percent of total silver consumption, led by solar PV, electronics, and automotive sectors. Investment demand – jewellery, coins and bars – makes up the remaining share. While investment demand spikes around festivals, the industrial pull is what keeps the market in deficit over the longer term.

What should first‑time buyers consider before purchasing silver?

First‑timers should verify the hallmarked purity (typically 925 % for jewellery), compare prices across reputable dealers, and keep an eye on macro‑economic cues like RBI policy and global dollar trends. Buying during a correction can lock in lower rates, but they should also be prepared for short‑term volatility.