TLDR
- Gold prices surged to a record high above $4,500 per ounce on Tuesday, marking the 50th all-time high of 2025
- Silver more than doubled in value throughout 2025, surpassing $69 per ounce, with both metals on track for their strongest annual performance since 1979
- Heightened tensions between the U.S. and Venezuela, along with Iran’s missile drills, spurred safe-haven demand for precious metals
- Central bank acquisitions, a weaker dollar, and expectations of lower interest rates bolstered the upward trend
- Goldman Sachs set a $4,900 price target for gold by the end of 2026, though some analysts caution about potential market corrections
Gold prices climbed above $4,500 per ounce on Tuesday, establishing another record in a year that has seen the precious metal hit 50 all-time highs. Spot gold traded 0.8% higher at $4,481.02 per ounce after touching $4,497.82 earlier in the day.
Silver sustained its robust momentum, rising over 0.6% to trade near $69.49 per ounce. The metal has more than doubled in value since January, outpacing gold’s 70% year-to-date increase.
Both precious metals are on course to post their largest annual gains since 1979. Platinum advanced 2.2% to $2,176.78 per ounce, reaching its highest level in over 17 years.
The latest surge occurred as tensions escalated between the United States and . The U.S. Navy attempted to seize a third oil tanker linked to Venezuela. President Trump warned of a potential naval offensive against Caracas and President Nicolás Maduro.
Trump also stated that the U.S. will retain oil from Chinese tankers seized off Venezuela’s coast. These geopolitical strains drove investors toward safe-haven assets such as gold and silver.
Geopolitical Tensions Drive Demand
Iran’s missile drills further heightened Middle East tensions. Reports indicated Israel planned to brief Washington on potential strikes against Tehran. These developments increased demand for precious metals as protective assets.
Thin trading volumes during year-end holidays amplified price movements across the metals market. Palladium jumped 3.5% to $1,834.57 per ounce.
Last week’s U.S. consumer price index came in below expectations, reinforcing market expectations that the Federal Reserve will implement multiple rate cuts in 2026. Lower interest rates reduce the opportunity cost of holding non-yielding bullion.
A weaker U.S. dollar and subdued Treasury yields contributed to bullion’s strength. Investors rebalanced portfolios toward defensive positions ahead of the holidays.
Central Banks Support Rally
Shree Kargutkar, senior portfolio manager at Sprott Asset Management, said is being viewed as a currency rather than a commodity. Central bank accumulation, exchange-traded fund purchases, and falling interest rates served as major tailwinds.
President Trump is expected to announce his pick to replace Federal Reserve Chair Jerome Powell, whose term ends in May. This has increased expectations for dovish Fed policy that could further boost prices.
Goldman Sachs maintains a “structurally bullish” outlook with a price target of $4,900 by the end of 2026. UBS forecasts gold to reach $4,500 by June 2026, driven by lower real yields and continued dollar weakness.
The World Gold Council suggests fiscal spending, central bank demand, and lower rates could push prices up by another 5% to 15% next year. Joe Cavatoni, senior market strategist at the World Gold Council, noted that gold may see moderate gains if economic growth slows and interest rates continue to fall.
However, Mike McGlone, senior commodity strategist at Bloomberg Intelligence, urged caution. He noted gold could easily reach $5,000 but might also drop to $3,500. McGlone pointed to gold’s 1979 rally and its subsequent more than 50% plunge by 1982.
