Silver prices plunged on Monday, hitting their lower circuit in futures trade as weak global cues and sustained selling pressure weighed on the metal.

On the Multi Commodity Exchange, silver for May delivery fell Rs 20,409, or 9 per cent, to Rs 2,06,363 per kilogram, reaching the lower circuit limit.

The fall came amid tensions in West Asia, with analysts pointing to broader macroeconomic factors as the key driver.

Hareesh V., head of commodity research, Geojit Investments Ltd, said, “Silver prices have fallen sharply on Monday despite escalating West Asian tensions due to overriding macroeconomic pressures.”

A stronger US dollar and rising Treasury yields added pressure on bullion, increasing holding costs and making dollar-denominated metals more expensive for global buyers.

In the international market, silver futures on Comex for the May contract declined $6.51, or 9.34 per cent, to USD 63.15 per ounce. Market experts also cited profit-taking after recent gains as a factor behind the decline.

Hareesh said, “Profit-taking and liquidity needs have also triggered selling after metals' earlier rally, with investors cashing out to cover losses elsewhere.”

Rising oil prices have added to inflation concerns, with expectations of delayed interest rate cuts further weighing on sentiment.

“Meanwhile, surging oil prices have intensified inflation fears, prompting expectations of delayed interest rate cuts, further putting pressure on assets such as silver. These forces have outweighed safe-haven demand, keeping precious metals under downward pressure,” he said.