Precious Metals Start the New Year Strong
Precious metals kicked off the new year positively on Friday, regaining momentum after an extraordinary rally in 2025. Ongoing geopolitical tensions and the anticipation of lower interest rates this year seem to be encouraging demand for these safe-haven assets.
Spot gold increased by 1.3%, reaching $4,372.02 an ounce at 0357 GMT. This was after it had set a record high of $4,549.71 on December 26, then dipped to a two-week low earlier this week.
Gold futures for February also saw a 1% rise, coming in at $4,386.40 per ounce. Tim Waterer, a chief market analyst at KCM Trade, mentioned, “Precious metals seem to be making up for the sell-off that occurred at the year’s close.” He noted that the pressures from year-end trading have lessened, allowing gold to kick off 2026 on a higher note as market fundamentals regain attention.
The bullion market had a remarkable year in 2025, boasting a 64% annual gain, marking the highest increase since 1979. Factors like interest rate cuts, expectations of further easing from the U.S. Federal Reserve, geopolitical conflicts, high central bank demand, and boosted exchange-traded fund holdings contributed to gold’s surge last year.
Recently, the number of jobless claims filed by Americans dropped to its lowest in a month, although it still points to a sluggish labor market under President Donald Trump’s administration. Waterer remarked that these jobless claims are unlikely to affect the forecast of multiple rate cuts expected this year.
“It seems precious metals are beginning 2026 just as they performed throughout 2025, which is with positive momentum,” he added. Investors are currently anticipating at least two rate cuts from the Federal Reserve this year. Generally, non-yielding assets thrive in low interest rate environments.
Spot silver rose by 2.8% to $73.30 an ounce, bouncing back after reaching an all-time high of $83.62 on Monday. Silver had a remarkable year, soaring 147%, and outshining gold significantly.
This surge was driven by U.S. critical mineral designations, supply shortages, and increased demand for both industrial and investment purposes. Spot platinum, after climbing to an all-time high of $2,478.50 on Monday, gained 3.1% to reach $2,116.40 an ounce, showcasing a 127% increase for its largest annual gain. Likewise, palladium saw a 2.2% rise to $1,641.03 an ounce, concluding the year at a 15-year high with a 76% jump.
