Despite record highs in the stock and crypto markets, economic uncertainty has pushed the precious metals market up considerably. Gold and silver have hit record levels this year: the value of gold has doubled from $2,798 in January to over $4,000 this fall — surpassing its prior highs. Silver hit $54.10 in October, breaking a 45-year-old benchmark.
Investors have long treated gold and silver as economic shields during volatile periods. Prices spiked heading into the recessions of 1980 and 2008-2009 and again during the COVID-19 pandemic.
Analysts said this year’s surge reflects a similar feeling among investors.
“Investors are cognizant of some longer-run risks that continue to bubble away under the surface,” Michael Brown, a senior research strategist at the investment firm Pepperstone, said in an interview.
President Donald Trump‘s economic agenda has been blamed for rising gold and silver prices, as investors attempt to make sense of the administration’s tariff policies in Trump’s second term.
Although gold’s meteoric rise began during the final year of former President Joe Biden’s administration, it accelerated sharply after Trump was sworn into office as traders hedged against tariffs. Prices also surged after the Liberation Day tariffs on April 2 and again during the summer, as the White House imposed more trade taxes.
But weeks after hitting nearly $4,400 in October, gold’s value dropped by about $300 as investors cashed out. Prices slid again during the first week of November before settling around $4,100 the week before Thanksgiving.
Further volatility could come from Europe. Italian lawmakers have suggested the country sell off its gold reserves to reduce its national debt. The Bank of Italy’s stockpile is worth roughly $300 billion. Questions remain about whether the bank or the government legally owns the gold, which could determine whether the reserves can be sold. A ruling that allows the government to sell the bars could drive down global prices. A similar situation happened between 1999 and 2002, when former U.K. Chancellor of the Exchequer Gordon Brown sold $3.5 billion worth of gold.
But other central banks are doing the opposite.
The World Gold Council reported that central bank gold purchases are up 10% compared with this time last year. Senior Market Analyst Louise Street said demand is driven by political uncertainty, the potential for stagflation, and expectations of lowered interest rates.
“The current environment suggests there could be more upside gains,” she said.
Other analysts remained bullish about the future of gold.
A J.P. Morgan research note said the recent price drops were likely individuals looking to make a profit. The bank does not believe the sell-off will dampen gold’s appeal and predicted prices will resume climbing, possibly reaching $5,055 by the end of 2026. UBS strategists offered a similar outlook, saying gold could reach at least $4,500 next summer due to strong demand. The World Bank, by contrast, expressed skepticism, saying gold could rise another 5% in 2026 before a 6% drop in 2027.
As with gold, politics also played a factor in silver’s rise.
Although silver’s rally began around the same time as Liberation Day, traders discovered the United Kingdom was running low on available silver. That caused a price spike because investors hoarded whatever silver they could find.
“The shortages were so acute that there were anecdotes of participants putting silver bars on planes to fly them across the Atlantic, a method usually far too expensive for physical silver,” Brown noted.
The metal’s value nearly doubled over six months, going from roughly $29.50 per ounce in April to $54.10 in October — levels not seen since 1980. When the price eased, the pullback was milder. Instead of crashing to $10, silver fell to $46.80 in mid-October. Analysts with the Silver Institute, an international association representing the industry, suggested it was proof of the market’s strength.
Part of that strength is silver’s importance in industries such as solar panels, electric vehicles, and advanced electronics. EBC Financial Group analysts said 50% of global demand went toward green technology as of this year. Solar could take up at least 15% of yearly silver production by 2030.
Russia has contributed to the rising demand, pledging $535 million in purchases over the next three years — possibly a hedge against U.S. sanctions. Saudi Arabia followed with two purchases totaling $40 million. By contrast, demand slipped in some major markets, including the United States.
That could change in the near future.
The Trump administration added silver to its list of critical minerals in November, making it important to the economy and national security. Investors hope the U.S. will focus on domestic silver mining and production. The designation also opens the door for the White House to impose tariffs on foreign silver, possibly upward of 50%, according to Citigroup.
However, silver buyers have a major problem: the lack of supply.
The Silver Institute said demand has outweighed supply for five straight years, leading to market tightness. While mining has increased in Russia and Mexico, it has decreased in Peru and Indonesia. Recycling hit a 13-year high but remained relatively flat.
Those factors could lead to another massive leap in prices. Analysts with French bank BNP Paribas predicted silver could flirt with $100 an ounce by the end of 2026. Longtime investor Peter Grandich agreed, declaring silver’s longtime label of “the poor man’s gold” was over. The World Bank was more cautious, suggesting silver could rise 8% in 2026 before a 10% drop in 2027.
Whether the precious metals market continues its financial resurgence appears likely given the current political climate.
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“Precious metal prices are deeply linked with economic uncertainty and move in the same direction,” Jai Kedia, a research fellow at the Center for Monetary and Financial Alternatives at the Cato Institute, said in an interview. He added that he expects gold and silver prices to keep rising due to the Trump administration’s trade policy.
A Federal Reserve rate cut in December could push more investors toward gold and silver. But with investors and central banks remaining bullish on precious metals, the gold and silver resurgence may be around for at least another year.
Taylor Millard is a freelance journalist who lives in Virginia.