Gold on Monday fell to its lowest level in 21 months and silver hit a 31-month low on heavy sell off by stockists, taking weak cues from overseas.
While gold dropped by Rs. 330 to Rs. 26,370 per 10 grams, matching its price on August 10, 2011, silver prices plunged by Rs. 1,530 to Rs. 42,170 per kg, a level last seen on November 26, 2010.
Selling pressure gathered momentum as precious metals in global markets extended their longest slump in four years as investment holdings contracted and stocks rallied and dollar surged against other currencies.
In global markets, which normally sets the price trend on the domestic front, silver tumbled 7 per cent to USD 20.69 an ounce, gold by 1.5 per cent to USD 1,338.85 an ounce.
Weak trend at futures trade as speculators offloaded their positions to shift their funds to rising equities, further fuelled the sentiment, they said.
Besides, fall in demand due to off marriage season and retail customers expecting more correction in the bullion prices was another dampening factor, they added.
On the domestic front, silver ready dropped by Rs. 1,530 to Rs. 42,170 per kg and weekly-based delivery by Rs. 1,485 to Rs. 41,170 per kg. Silver coins nosedived by Rs. 3,000 to Rs. 72,000 for buying and Rs. 73,000 for selling of 100 pieces.
Similarly, gold of 99.9 and 99.5 per cent purity tumbled by Rs. 330 each to Rs. 26,370 and Rs. 26,170 per 10 grams, respectively. Sovereigns, too, plunged by Rs. 200 to Rs. 23,500 per piece of eight grams.