Gold and silver prices are falling sharply today, February 5, 2026, due to a stronger US dollar, a global sell-off in technology stocks, and investor caution regarding US Federal Reserve policy. Silver has been particularly volatile, crashing up to 15% in global spot markets and hitting lower circuits in Indian futures.

Primary Reasons for the Decline

• Strengthening US Dollar: The US dollar index (DXY) rose to approximately 97.76. A firmer dollar makes greenback-priced commodities like gold more expensive for holders of other currencies, dampening demand.
• Hawkish Federal Reserve Outlook: Markets are reacting to the nomination of Kevin Warsh as the next Federal Reserve chair. Perceived as an inflation hawk, his leadership has fueled speculation of a tighter monetary policy and a slower pace of interest rate cuts.
• Global Equity Sell-off: A sharp decline in global technology stocks, driven by valuation concerns and heavy AI spending, has triggered broad risk aversion. In such high-volatility environments, investors often liquidate profitable positions in precious metals to cover losses elsewhere.
• Increased Trading Costs: The CME Group and domestic exchanges like the MCX have recently raised margin requirements for gold and silver futures. These higher costs force traders to unwind speculative positions, leading to rapid price corrections.
• Easing Geopolitical Tensions: News of upcoming talks in Oman regarding the US-Iran situation has reduced the "safe-haven" premium that previously supported higher bullion prices.

Current Market Data (February 5, 2026)

Key Insights: Analysts describe this as a deep correction following a historic, arguably unsustainable rally in late January. Silver remains roughly three times more volatile than gold due to its dual role as an industrial commodity and a precious metal.