Today 12:55
Gold and silver rose to all-time highswhile rising geopolitical tensions and bets on further interest rate cuts in the US added momentum to the best annual performance in more than four decades.
Gold rose more than 1.5%, surpassing the previous record of $4,381 an ounce set in October, while silver rose as much as 3.4% to approach $70 an ounce, extending gains and putting both metals firmly on track for their best annual performance since 1979.
The latest uptick comes as traders bet that the Federal Reserve will cut interest rates twice in 2026 as US President Donald Trump also favors looser monetary policy. Lower interest rates tend to favor precious metals that do not pay interest.
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Increasing geopolitical tensions It also strengthens the attractiveness of gold and silver as a safe haven. The USA tightened its oil blockade against Venezuela, increasing pressure on the government of President Nicolás Maduro, while Ukraine attacked an oil tanker from the Russian shadow fleet in the Mediterranean for the first time.
Gold has risen nearly 70% this year, helped by larger central bank purchases and inflows into exchange-traded funds backed by gold bullion. Trump’s aggressive moves to reshape global trade – as well as his threats against the independence of the Federal Reserve – added fuel to the strong rally earlier this year.
Investors have also played a major role in the rise in gold prices, due in part to so-called debasement trading – a move away from government bonds and the currencies in which they are denominated because they fear their value will decline over time due to rising debt levels. Gold-backed ETFs are seeing four consecutive weeks of increases in inflowsTotal holdings in these funds have increased every month this year except May, according to data compiled by Bloomberg and figures from the World Gold Council.
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“Today’s rally is largely due to early positioning on Fed rate cut expectations, reinforced by low year-end liquidity,” said Dilin Wu, strategist at Pepperstone Group Ltd. Weak employment growth and weaker-than-expected US inflation in November supported the narrative of further rate cuts, he added.
Other precious metals also rose, with palladium gaining more than 4%.. The price of platinum continued its eighth consecutive period of increase, breaking above $2,000 for the first time since 2008.
Gold quickly recovered after a correction from the October peak when the rally was considered crowded and overheated, and is now positioned to extend those gains into 2026. Goldman Sachs Group Inc. is among banks that expect prices to rise further next year, with a base case of $4,900 an ounce and upside risks. According to the bank, ETF investors are starting to compete with central banks for limited physical supply.
Central bank purchases, physical demand and geopolitical hedging were “Medium to long-term anchors as Fed policy and real interest rates continue to drive cyclical moves,” said Pepperstone’s Wu. New entrants to the gold market, such as stablecoin issuers such as Tether Holdings SA and some corporate treasuries, created a “broader capital base” that “provides resilience to demand,” he said in a note.
Silver’s recent rise has been supported by speculative inflows and ongoing supply imbalances in major trading venues following a historic short squeeze in October. Total trading volume for silver futures in Shanghai jumped earlier this month to levels roughly in line with those seen during the tightening a few months ago.
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