Gold & Silver ETFs Surge Despite Weak Global Prices, Some Funds Jump Up to 5%
Gold and silver prices may be under pressure in the international market, but investors in exchange-traded funds (ETFs) linked to these precious metals had a reason to celebrate. On June 12, several Gold ETFs and Silver ETFs delivered strong gains, with some silver-focused funds rising by more than 3% and select metal ETFs posting gains of nearly 5%.
The rally came even as global bullion prices remained weak and were heading toward a negative weekly close.
Precious Metal ETFs Outperform Amid Market Optimism
Indian equity markets witnessed a strong rally during the trading session, boosting overall investor sentiment. Optimism surrounding potential diplomatic progress between the United States and Iran lifted market confidence, pushing benchmark indices sharply higher.
The Sensex climbed more than 1,000 points in early trade, while the Nifty crossed the 23,450 mark. Meanwhile, India VIX, often referred to as the market's fear gauge, slipped significantly, indicating reduced volatility concerns.
Against this backdrop, Gold and Silver ETFs emerged as notable gainers.
Silver ETFs Lead the Rally
Silver-focused ETFs recorded the strongest gains among precious metal investment products.
Top Performing Silver ETFs
| ETF Name | Price | Gain |
|---|---|---|
| Nippon India Silver ETF (SilverBeES) | ₹228.14 | 3.05% |
| ICICI Prudential Silver ETF | ₹238.08 | 3.05% |
| SBI Silver ETF | ₹233.62 | 3.02% |
| Tata Silver ETF | ₹23.18 | 3.11% |
Strong buying activity in these funds helped silver ETFs outperform many other investment categories during the session.
Gold ETFs Also Shine
Gold ETFs also attracted investor interest and delivered healthy gains despite weakness in international bullion prices.
Leading Gold ETFs
| ETF Name | Price | Gain |
|---|---|---|
| Nippon India Gold ETF (Gold BeES) | ₹121.14 | 1.56% |
| ICICI Prudential Gold ETF | ₹125.54 | 1.50% |
| SBI Gold ETF | ₹124.86 | 1.51% |
| Tata Gold ETF | ₹14.22 | 1.43% |
The rise indicates that domestic factors and investor positioning played a major role in supporting ETF prices.
Why Did Gold and Silver ETFs Rise?
Interestingly, the gains came even as international gold prices remained under pressure.
Global Gold Prices Decline
Spot gold slipped nearly 0.5% to around $4,193.58 per ounce and was on track to end the week approximately 3% lower. Earlier, the metal had fallen to its lowest level in more than six months.
However, sentiment improved after U.S. President Donald Trump reportedly postponed a planned military action against Iran and hinted at the possibility of a diplomatic settlement. The easing geopolitical tensions helped stabilize precious metal markets.
Government Reduces Import Tariff Value
Another key factor supporting precious metal-related investments was the government's decision to lower the tariff value, or base import price, for gold and silver.
Revised Import Values
-
Gold tariff value reduced by $80 to $1,343 per 10 grams.
-
Silver tariff value reduced by $276 to $2,092 per kilogram.
The revised rates became effective from June 12.
What Does Lower Tariff Value Mean?
Tariff value serves as the reference price used to calculate customs duties on imported gold and silver. It is not the actual market price but acts as the benchmark for duty calculations.
A reduction in tariff value can lower the effective import cost of precious metals, which may support demand and improve sentiment toward gold and silver-related investment products.
Should Investors Consider Gold and Silver ETFs?
Gold and Silver ETFs continue to offer investors a convenient way to gain exposure to precious metals without the need to physically buy and store them.
Key Benefits
-
Easy trading through stock exchanges.
-
No storage or security concerns.
-
High liquidity.
-
Transparent pricing linked to metal values.
-
Suitable for portfolio diversification.
While short-term fluctuations are common, many financial experts view precious metal ETFs as useful hedging tools during periods of economic uncertainty and market volatility.
Outlook for Investors
Although global bullion prices remain under pressure, supportive domestic factors, lower import costs, and improving investor sentiment have helped Gold and Silver ETFs outperform.
Market participants will continue to monitor international developments, interest-rate expectations, currency movements, and geopolitical events to assess the next direction for precious metal investments.
For now, ETF investors appear to be benefiting from renewed interest in gold and silver despite weakness in the global spot market.
