Gold & Silver Rates Crash On February 1: MCX Gold & Silver Fall 9%; Custom Duty & GST Cut Eyed In Budget 2026

Gold rates and silver rates in India crashed during the special live trading session on Sunday, February 1st. Both MCX gold and silver futures nosedived by over 9%. The 10 grams gold price has slipped below Rs 1.40 lakh mark. The latest correction comes after spot gold price crashed steeply over 8% to erase $5,000 mark and struggle around $4,880 levels.

The profit booking has sparked a severe bearish trend in global metal stocks. Also, investors booked in gains in gold and silver after they witnessed record-rallies to over Rs 1.7 lakh mark and the Rs 4.4 lakh mark. It is believed that gold and silver are in an overbought territory and the current selling pressure is an adjustment to the performance.

Despite the latest fall, gold rates in India have climbed over 90% in a year, while spot gold and silver have given a whopping 75% and 171% return in a year. The outlook for gold remains bullish in the long term.

For MCX, the biggest mover on February 1st is Union Budget 2026 presentation which will be announced by Finance Minister Nirmala Sitharaman. Investors of precious metals are eyeing major cuts in custom duty and GST rates that could spur demand and ease precious metal prices for a temporary basis.

MCX Gold Price Today:

At the time of writing, MCX gold futures with February 2026 expiry, stood at Rs 1.40 lakh, down by Rs 9653 or 6.5%. This is near its intraday low of Rs 1,36,185 per 10 grams. Overall, in the early deals of February 1st, gold has crashed around 9%.

Furthermore, MCX gold with April 2026 expiry, also dropped by 9% to hit an intraday low of Rs 1,38,634 per 10 grams.

According to Ponmudi R, CEO of Enrich Money, MCX Gold futures have witnessed a sharp rejection from the Rs1,80,000-Rs1,81,000 zone, followed by an aggressive breakdown, confirming short-term trend exhaustion after a parabolic rally. The price has slipped back toward the Rs1,36,000 region, indicating heavy profit booking and long liquidation rather than healthy consolidation. Although the broader long-term trend was bullish, the recent move clearly reflects distribution at higher levels.

MCX Silver Price Today:

MCX silver price with March 2026 expiry, traded at its intraday low of Rs 2,65,652 per 1Kg, recording one of the biggest single-day crash of Rs 26,826 or 9%. The May 2026 expiry, is also down by 9%.

For silver, Ponmudi said, MCX Silver futures have seen an extreme volatility-driven reversal after posting record highs near Rs4,20,000, followed by a near-vertical collapse toward Rs2,84,000, confirming blow-off top behavior. The breakdown invalidates the steep bullish channel and signals panic unwinding of leveraged long positions. Momentum indicators have flipped from extreme overbought to oversold within a very short span, highlighting structural instability rather than healthy correction.

Gold & Silver Budget Expectations:

Experts believe a custom duty cut and further easing in GST rates could be beneficial for gold and silver.

According to Choice Wealth report, rationalisation of import duty and GST is likely to improve affordability and support demand recovery. It cited that GJC has proposed a reduction in GST on gold and silver jewellery, from the current 3.0% to 1.25%.

Analysts here explained that Simplification of custom duty procedures and compliance norms are expected to enhance export competitiveness. Furthermore, the India-EU FTA remains a structural positive, with the removal of the 4% EU import duty, improving price
competitiveness.

Accordingly, the above factors are expected to drive incremental export orders and support medium-term volume growth for organised, export-oriented players.

"We believe the rapid scaling up of organised jewellery retail chains is structurally positive for B2B gold jewellery manufacturers. It not only ensures greater business visibility and operational stability but also accelerates the sector's formalisation. Over the medium term, B2B players with strong design agility, automation-driven production, flexibility to move across karat categories and compliance-led manufacturing will emerge as preferred partners, benefiting astronomically from the expansion of organised retail," analysts said.

Gold & Silver Prices Prediction:

In Ponmudi's opinion, for MCX gold, the rising channel support has been decisively tested, and momentum has shifted into sell-on-rise mode. Immediate stability is required above Rs1,32,000-Rs1,35,000 to avoid further downside extension. Until price regains Rs1,45,000, rallies are likely to face supply, keeping the near-term outlook cautious to corrective.

In case of silver, the Rs2,60,000-Rs2,55,000 zone is now a critical demand area; failure to hold may open deeper corrective risk. Any pullback toward Rs3,00,000-Rs3,10,000 is expected to attract selling pressure. The trend remains bearish-biased in the short term, with volatility expected to stay elevated.

During Budget FY25, after the saffron party won the general election, Finance Minister Nirmala Sitharaman announced the full-fledged Budget, where she reduced the total customs duty on the import of gold to 6% from 15%. Also, the duty on gold ore imports was brought down to 5.35% from 14.35%. Meanwhile, platinum and silver bars also recorded a sharp decline in their duty to 6.4% and 6%, respectively.

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