Silver Shocker! Mutual Funds Freeze Investments as Prices Surge Amid Trump’s Tariff Turmoil

Global financial markets are facing fresh turbulence as silver prices skyrocket to record levels, forcing several major mutual funds in India—including SBI, Kotak, and UTI—to temporarily suspend new investments in silver ETFs. The move comes amid an unprecedented supply crunch and rising global trade tensions following US President Donald Trump’s new tariff announcements.

According to market analyst Amrish Baliga, volatility is set to persist. “Global markets clearly are volatile and going to remain volatile as long as President Trump is there, because you never know what he is going to announce next,” Baliga said.

Silver prices have surged sharply over the past two weeks, driven by increased industrial demand, speculative buying, and a weakening dollar. Analysts note that domestic silver is now trading at a premium of 12–15% over international prices due to import bottlenecks and limited availability.

Mutual Funds Hit Pause

The decision by leading mutual funds to freeze fresh inflows into silver ETFs reflects growing concern over pricing inefficiencies and short-term speculation. Fund managers have highlighted that global refiners are struggling to meet delivery commitments, and the spike in premiums makes new investments unattractive for retail participants.

Industry insiders expect the restrictions to remain in place until market premiums normalize. In the meantime, experts recommend investors exercise caution, as volatility in both precious metals and equity markets could intensify in the lead-up to Diwali.

Muted Debut for Tata Capital IPO

In a contrasting development, the much-anticipated ₹15,500 crore Tata Capital IPO made a subdued debut on Dalal Street. The stock listed nearly flat amid cautious sentiment and global market jitters. Analysts attribute the lukewarm response to investor risk aversion and the ongoing uncertainty surrounding Trump’s 100% tariff threats on Chinese goods.

Market experts predict that near-term performance will hinge on US-China trade negotiations, global commodity cycles, and festive season demand in India. Sectors such as IT, consumption, and commodities remain under watch for potential volatility.

As the festive season nears, investors are advised to balance portfolios, avoid speculative bets, and track geopolitical signals that could further impact global commodities and equity indices.