Gold and silver prices have surged sharply over the past few months, but have now begun to ease. After touching record highs in January 2026, both metals have entered a correction phase, leaving investors uncertain about whether to stay invested or exit. Over the past 18 months, precious metals have delivered exceptional returns: gold has risen by more than 100% in rupee terms, while silver has gained nearly 200%. This remarkable rally has kept bullion firmly in the spotlight. However, financial experts now advise caution, with some recommending partial profit-booking.
Several global and domestic factors drove the rally in gold, silver, and other precious metals. Rising geopolitical tensions, US trade policies, inflation concerns, aggressive buying by central banks, and volatility in equity markets have all contributed to supporting prices. Silver has outperformed in particular because it serves both as a safe-haven asset and an industrial metal. It is widely used in solar panels, electric vehicles (EVs), and artificial intelligence (AI) technologies.
Indian investors have also shifted funds from equities to bullion-linked schemes. In January, inflows into precious metals ETFs climbed to Rs 33,503 crore, surpassing equity fund investments of Rs 24,029 crore for the first time.
Why Are Prices Under Pressure? In January 2026, gold and silver reached peak levels. Since then, prices have corrected. International silver has declined 36.63% from its high, while gold has fallen 7.8% from its peak.
What Do Experts Say? According to a report by The Times of India, some wealth managers believe this may be an appropriate time to book profits. Sahil Kapoor of DSP Mutual Fund has suggested that investors who entered the market over the past 18 months should consider partial profit-booking and adopt a cautious stance.
Others recommend a balanced strategy. Akshay Chinchalkar of The Wealth Company advises using Systematic Investment Plans (SIPs) to increase exposure gradually rather than investing a lump sum. For new investors experiencing FOMO (Fear of Missing Out), he cautions against aggressive buying at elevated levels and suggests starting with modest allocations.
Impact On India’s Trade Deficit: Gold and silver imports have also influenced India’s trade balance. In January, the trade deficit widened to a three-month high of $34.6 billion. Imports rose 19.1% to $71.2 billion. Gold imports jumped 4.5 times to $12 billion, while silver imports increased 2.3 times to $2 billion.
Exports, however, grew by only 0.8% to $36.6 billion. While sectors such as electronics and pharmaceuticals recorded slight growth, diamonds, jewellery, and textiles remained weak. The government remains optimistic about achieving record exports of nearly 860 billion dollars this year, with service exports expected to cross $410 billion for the first time. There are also signs of improving US demand after the withdrawal of 25% secondary tariffs in early February.
Should You Hold Or Sell? Precious metals have already delivered strong gains, and prices have retreated from recent highs. In the short term, upside may be limited as global factors, including inflation, US interest rates, and geopolitical tensions, continue to influence the market.
If you have earned substantial returns, booking partial profits may be prudent. For first-time investors, starting with a small, staggered investment approach is advisable. After such a significant rally, a cautious and balanced strategy is the most sensible course.
Check JEE Mains Result 2026 Link Here