Key Highlights
- Gold rose to a fresh record on Tuesday, hovering just below the $4,500 per ounce mark amid dollar weakness and geopolitical risks.
- Silver joined the rally, hitting an all-time high, supported by supply deficits and strong industrial demand.
- Investors remain focused on dovish Federal Reserve expectations and heightened geopolitical uncertainty.
Gold prices extended their record-setting run on Tuesday, stopping just short of the $4,500 per ounce threshold, as a weaker US dollar and persistent geopolitical uncertainty continued to drive demand for safe-haven assets. Silver also joined the rally, pushing to a new all-time high.
Gold Extends Record Rally as Silver Climbs to Fresh High
Spot gold rose 1% to $4,488.94 per ounce as of 0857 GMT, after touching an intraday record of $4,497.55, according to market data. US gold futures for February delivery gained 1.1% to $4,520.10, reflecting sustained investor appetite for bullion.
The rally was driven by a mix of economic signals and geopolitical tensions, traders said.
Dollar Weakness and Fed Expectations Support Bullion
The US dollar extended losses for a second consecutive session and was on track for its largest annual decline since 2017, boosting the appeal of dollar-denominated commodities such as gold.
According to Carlo Alberto De Casa, external analyst at Swissquote, expectations of looser monetary policy remain a key driver. “Expectations for a dovish Fed, markets losing confidence in the greenback, geopolitical tensions, and central bank buying are all supporting gold,” De Casa said, adding that investor demand remains strong due to the convergence of these factors.
Markets are currently pricing in two US interest rate cuts in 2026, as speculation grows that Trump could name a new Federal Reserve chair earlier than usual next year, reinforcing expectations of a more accommodative policy stance.
Lower interest rates typically reduce the opportunity cost of holding non-yielding assets such as gold, making bullion more attractive during periods of monetary easing.
Geopolitical Risks Add to Safe-Haven Demand
Geopolitical tensions have also contributed to the surge in precious metals. Last week, Trump ordered a “blockade” of sanctioned oil tankers entering and leaving Venezuela, while saying he was not ruling out the possibility of war with the country.
These developments have added to broader global uncertainty, prompting investors to seek refuge in traditional safe-haven assets. According to market analysts, geopolitical risks have become an increasingly important driver of bullion prices alongside monetary policy expectations.
Gold has now climbed more than 70% so far this year, reflecting sustained inflows as investors hedge against economic volatility, geopolitical instability, and declining real yields.
Silver Hits Record on Supply and Industrial Demand
Silver prices continued to outperform, rising 0.7% to $69.51 per ounce after touching a record $69.98 earlier in the session, as reported by Reuters.
The metal has surged 142% year-to-date, supported by persistent supply deficits, robust industrial demand, particularly from renewable energy and electronics, and growing investment inflows.
Ahmad Assiri, research strategist at Pepperstone, said both metals appear firmly supported at elevated levels. “Both gold and silver continue to attract buying strength,” Assiri said, adding that the market increasingly views $4,500 for gold and $70 for silver not as hard ceilings, but as reference points within an ongoing uptrend.
Platinum and Palladium Track Broader Strength
The rally extended across the broader precious metals complex. Spot platinum jumped 3% to $2,183.90 per ounce, its highest level in more than 17 years, while palladium rose 2.8% to $1,811.20, marking a three-year high.
Analysts said gains in platinum and palladium were partly driven by spillover demand from gold and silver, as well as expectations of tightening supply conditions in key producing regions.
Outlook Remains Supportive
With the dollar under pressure, interest rate expectations shifting, and geopolitical risks lingering, analysts expect precious metals to remain well supported in the near term. Thin holiday trading conditions could also amplify price moves, keeping volatility elevated across bullion markets.
