Gold prices drop 21% in 20 days; Could Trump-Putin dynamics push rates below ₹1 lakh?

Gold and silver prices have fallen sharply over the past 20 days, with gold down 21% and silver down 45%, amid expectations of a stronger US dollar and easing geopolitical tensions. Experts suggest prices may decline gradually, possibly pushing gold below ₹1 lakh by 2027.

Gold and silver prices have witnessed a sharp correction over the past 20 days, raising fresh concerns among investors and households alike. Gold, which was nearing ₹2 lakh per 10 grams in late January, has now slipped close to ₹1.5 lakh. Market estimates suggest that if the current trend continues, prices could gradually decline even below ₹1 lakh by 2027.

In today’s episode of DNA, Rahul Sinha, Managing Editor of Zee News, conducted a detailed analysis of the factors driving this decline and what it means for investors. On the Multi Commodity Exchange (MCX), 10 grams of 24-carat gold fell about 1% in the evening session to around ₹1,53,000, while in the bullion market it dropped by ₹2,242 to nearly ₹1,51,000. On January 29, gold in the futures market had touched ₹1,93,000, marking a fall of ₹40,000, or 21%, in just 20 days.

Silver has corrected even more sharply. On MCX, prices declined nearly 3% to around ₹2,32,000 per kilogram. Just 20 days ago, silver had crossed ₹4,20,000 per kilogram, indicating a drop of ₹1,88,000, or about 45%. This downturn follows a strong 2025, when gold delivered approximately 75% returns, and silver surged nearly 170%. However, 2026 has begun with steep losses for recent investors.

The decline is not limited to domestic markets. Internationally, gold is trading below $5,000 per ounce. A key trigger behind the global trend is a report, cited by international media and based on internal Russian government documents, suggesting that Russia is considering a return to the US dollar-based settlement system. Since 2022, following Western sanctions, Russia has reduced its dependence on the dollar and shifted to trading in rubles or partner currencies, including rupees in trade with India. This de-dollarization trend has prompted several central banks to increase their gold reserves, supporting global prices.

If Russia resumes dollar-based trade, demand for the dollar could rise, potentially reversing de-dollarization. Gold and the dollar typically share an inverse relationship; stronger dollar demand often pressures gold prices. Analysts also suggest that central banks may slow their gold purchases, or even increase supply in the market, if dollar usage expands. Additionally, improved relations between Donald Trump and Vladimir Putin could ease geopolitical tensions, reducing safe-haven demand for gold.