Gold, silver ETFs fall up to 3% as precious metals decline, SEBI proposes measures to curb volatility

Gold and silver ETFs

• Gold and silver ETFs dropped as investors took profits.
• SEBI plans to review ETF price bands to reduce recent volatility.
• Market holidays and thin trading caused precious metal declines.

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Gold and silver exchange traded funds (ETF) dropped in trade on February 16, as precious metals succumbed to profit booking after gains in the previous session. Market regulator SEBI has proposed to review the price bands for the ETFs which have recently seen significant volatility.

As seen at 12.45 pm, Edelweiss Silver ETF was down around 3 percent, while Bandhan Bank Silver ETF, Kotak Silver ETF, Aditya Birla Sun Life Silver ETF, ICICI Prudential Silver ETF, 360 ONE Silver ETF, SBI Silver ETF, Mirae Asset Silver ETF, Nippon India Silver ETF (Silverbees) and others fell more than 2 percent each.

Among the gold ETFs, Choice Gold ETF declined around 2 percent, while Angel One Gold ETF, Motilal Oswal Gold ETF, Kotak Gold ETF and few others were trading in the red with marginal losses, with several others in the green.

Gold and silver prices today:

Silver futures on the Multi Commodity Exchange of India were down around 2 percent to trade at Rs 2,40,034 per kilogram, as seen at 12.50 pm. This came after the contracts fell around 4 percent earlier during the day to Rs 2,35,208 per kg.

Gold futures on the exchange were meanwhile down around 0.5 percent each.

Why are gold, silver prices falling today?

Global gold and silver prices declined today amid thin margins as US and China markets remained closed due to local public holidays. The fall also comes as investors may have resorted to profit booking after the precious metals surged on Friday.

"Gold has given back some of Friday's post-CPI gains today due to thinner trading conditions and a lack of fresh upside catalysts," Reuters quoted Tim Waterer, KCM chief analyst, as saying. US markets are closed for the Presidents' Day holiday, while markets in China are closed for the Lunar New Year holiday.

SEBI proposes measures to curb volatility in gold, silver ETFs:

The Securities and Exchange Board of India (SEBI) last week proposed a comprehensive review of the framework related to base price determination and price bands for ETFs, citing concerns around volatility alignment and operational gaps in the current system. Moneycontrol had reported on August 2025 that SEBI is deliberating on such a proposal.

Among the measures, the market regulator proposed rationalising the existing uniform ±20 percent price band applicable to most ETFs (±5 percent for Overnight ETFs investing in TREPs).

What lies ahead?

Gold prices have turned choppy following their sharp swings in early 2026, but the broader structure still appears constructive, said Hareesh V, Head of Commodity Research, Geojit Investments Limited.

The analyst added that the recent volatility in precious metals was driven by shifts in Fed expectations, dollar strength, and speculative flows. “Yet gold continues to hold above key psychological levels near $5,000, keeping the medium term bias intact. Most institutional forecasts also support a positive long term narrative for 2026, underpinned by strong central bank buying, geopolitical uncertainty, and a softer dollar outlook,” he further said.

“In the near term, trading may remain two way as markets digest US policy signals and risk events. However, dips are likely to attract buyers, supported by resilient safe haven demand and slowing real yields. Overall, while short term consolidation or pullbacks are possible, the long term trajectory remains upward, not indicative of a major correction,” according to the analyst.

Sandip Raichura, CEO of Retail Broking and Distribution & Director, PL Capital, meanwhile said that although the India-US trade deal, a potential deal with Brazil and other factors have reduced the uncertainty, higher inflation as well as continuing geopolitical uncertainties apart from the emerging split between the North West and the rest of the world will continue to propel reserve bank buying. “We believe all dips are an opportunity to buy Gold,” he said.

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