Gold, silver ETFs: BSE imposes 20% circuit limit after metal meltdown

In the wake of a record crash in gold and silver prices, the BSE has imposed a 20% circuit limit on Gold and Silver ETFs. For the current trading session, ETF prices will be anchored to the previous day’s NAV (T-1 NAV), with transactions allowed only within a ±20% band. The move aims to curb excessive intraday volatility and protect investors from abrupt price swings.

“In view of the volatility in underlying Gold & Silver prices, Reference Price for Gold and Silver ETFs traded on the Exchange shall be based on the T- 1 NAV as published by the respective Mutual Funds / Asset management Companies. Accordingly, the prescribed price band of +/- 20% shall be applicable to the said T- 1 NAV price for trading purposes,” BSE said in a circular earlier today.

This comes after Gold and silver futures opened sharply lower on the Multi-Commodity Exchange (MCX) on February 1, extending the selloff after their worst-ever crash on Friday. MCX Gold futures due April 2, 2026, opened Rs 9,140 lower or 6% to Rs 1,43,205 per 10 grams. Meanwhile, silver futures for March 5, 2026, delivery tanked by Rs 17,515 or 6% to Rs 2,74,410 per kg.

As a result, ETFs edged sharply lower, down by as much as 16% in early Friday trade. Baroda BNP Paribas Gold ETF, Edelweiss Gold ETF, and Motilal Oswal Gold ETFs fell upto 16% on the budget day. LIC MF Silver ETF went down by 15% in the same time period.

On Friday, Silver plunged up to 27% — or Rs 1,07,968 — in a single day, marking its worst ever crash and dragging prices back below the Rs 3 lakh mark, just a day after the metal had soared to a record high of Rs 4 lakh. Gold prices tanked as much as 12% or Rs 20,514 in a single day on January 30, marking their worst one-day rout since March 2013, when prices had plunged 9% on the MCX.

The drop came after U.S. President Donald Trump announced Kevin Warsh as his choice for the new Federal Reserve Chair. The development strengthened the US dollar, pushing it above the 97 mark as concerns over central bank independence eased following Warsh’s nomination. A stronger US dollar is typically negative for gold because the yellow metal is globally priced in US dollars, making it more expensive for foreign buyers and thereby dampening demand.

Also read: MCX shares crash 15%, hit lower circuit amid deepening gold, silver rout

With international markets shut, global cues will be absent, keeping the focus firmly on local factors. Meanwhile, changes in import duties announced in the Union Budget 2026 could influence domestic prices.

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