Crash-like conditions developed on the bullion market on Saturday as gold prices recorded the biggest ever fall of Rs 1,250 per ten gram to hit one-year low on frantic selling by stockists amid a steep fall in overseas markets.
Gold prices, which had been on rolling-down mode this week and dropped below Rs 30,000, fell further sharply by Rs 1,250 to Rs 28,350 per 10 grams, a level last seen on April 7 last year following a steep fall of $84 to $1,477 an ounce in global markets.
"The gold suffering such a biggest single day fall of Rs 1,250 is never seen before and may lose more ground in coming days mostly influenced by speculative selling in futures markets,' said Surender Jain, vice president of All India Sarafa Bazar.
He said the market was mostly driven by global marketsand futures trade, while there was hardly any physical buying.
The gold in New york, which normally sets price trend on the domestic front, tumbled to the lowest since July 2011 on signs that investors are favouring the dollar and equities as the global economy recovers.
Market experts said despite the ongoing 'Navratras' retailers remained on sidelines on expectations of more correction in the prices.
Meanwhile, gold in futures trading dipped below Rs 28,000 on the Multi Commodity Exchange as speculators remained net sellers.
Silver also recorded a steep fall of Rs 2,500 at Rs 50,100 per kg on falling demand among industrial units and coin makers in the face of stockists selling driven by a hefty fall of 6.54 per cent to 25.85 dollar an ounce in New Uork.
On the domestic front, gold of 99.9 and 99.5 per cent purity suffered a whopping loss of Rs 1,250 each at Rs 28,350 and Rs 28,150 per ten grams respectively. Sovereign followed suit and lost Rs 300 at Rs 24,800 per piece of eight gram.
In a similar fashion, silver ready nosedived by Rs 2,500 to Rs 50,100 per kg and weekly-based delivery by Rs 2,745 to Rs 48,780 per kg. Silver coins also dropped by Rs 2,000 to Rs 77,000 for buying and Rs 78,000 for selling of 100 pieces.