Silver and gold ETFs plunged up to 8% on Thursday as gold and silver prices extended their decline for a second straight session on the MCX. The fall was driven by a stronger US dollar and rising expectations that the US Federal Reserve may raise interest rates later this year.Tata Silver ETF fell the most, dropping around 8% to hit a day’s low of Rs 20.01 against its previous close of Rs 21.66. HDFC Silver ETF declined 6%, while around 38 other silver ETFs fell about 5%. Bandhan Silver ETF slipped 4% to a day’s low of Rs 214.01.Also Read | NFO Insight: Can JM Multi Asset Allocation Fund help investors navigate uncertain market? There were 23 gold ETFs. Of these, Kotak Gold ETF and Quantum Gold Fund fell 4% each, while the others declined in the range of 1% to 3%.Abhishek Bhilwaria, Partner at BhilwaraFinserv, told ETMutualFunds that investors should view the recent correction in gold and silver as a strategic opportunity to accumulate through dollar-cost averaging rather than a reason to exit the market. While both metals have retreated from their January 2026 peaks due to a stronger US dollar and shifting interest rate expectations, their core structural drivers remain intact.He added that to maximise safety, investors should maintain a balanced 5%–15% portfolio allocation, prioritise highly liquid instruments such as ETFs, and favour gold for wealth preservation while treating silver as a more volatile, high-beta growth play.In the domestic market, MCX silver futures for July 2026 delivery fell Rs 15,526 over two sessions (7%) to Rs 2,10,308 per kg. Gold futures for August 2026 delivery declined by Rs 5,863 to Rs 1,40,666 per 10 grams. In the previous session, both contracts had slipped up to 0.2%.According to the CME FedWatch Tool, traders are now pricing in three rate hikes this year and see a roughly 67% probability of a hike in September. The US dollar rose for a third consecutive session on Wednesday, touching a 13-month high and making gold more expensive for holders of other currencies.In the international market, spot gold slipped 0.4% to $3,985.89 per ounce at 0043 GMT, after falling to its lowest level since November 2025 on Wednesday. US gold futures for August delivery were down 0.2% at $4,001.60. Bullion also slipped below the key $4,000-an-ounce mark on Wednesday for the first time since November 2025.Among other precious metals, spot silver eased 0.2% to $57.33 per ounce, platinum fell 0.2% to $1,575.85, while palladium edged up 0.3% to $1,170.25.Manoj Kumar Jain of Prithvi Finmart said gold and silver prices are likely to remain volatile this week amid fluctuations in crude oil prices and the dollar index, as well as ahead of US GDP and core PCE inflation data releases.Also Read | Retired and scared of mutual funds? Expert suggests how to invest Rs 1 crore without taking excessive risk Jain advised investors against bottom-fishing in precious metals at current levels, but suggested exiting short positions as the market has entered an oversold zone.(Disclaimer: Recommendations, suggestions, views and opinions expressed by the experts are their own and do not represent the views of The Economic Times)