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Silver nears new peak as gold blazes past record $3,800

Gold reached another record on Wednesday. This brings the gains for this year to 47%. The reasons include expectations of further interest rate cuts in the United States, safe-haven demands and a weaker dollar.

Silver is also up 63% in this year and hovering near its record high.

BULL RUN GATHERS PUSHES PACE

Gold spot reached a record of $3,895.09 per ounce, and traded at $3,864.16 as recently as 1520 GMT. Bullion is a non-returning asset that attracts investors during times of geopolitical or economic uncertainty. It registered a 27% increase last year.

Joseph Cavatoni is a senior market strategist with the World Gold Council, a trade association.

What's important is that the safe-haven trend is now layered over structural allocation trends, meaning that gold isn't only reacting to current events but is also gaining traction in portfolios.

The Federal Reserve has cut interest rates in the United States for the first time in this year, in September. Markets are pricing in another two cuts by 2025.

The conflict in the Middle East, the Russian invasion of Ukraine and fears about the independence of the U.S. Federal Reserve under President Donald Trump have all contributed to market volatility and economic uncertainty.

The gold rally is also backed by central bank purchases, rising inflows to gold exchange-traded fund (ETFs), and a weaker US dollar.

As long as there is uncertainty, ETF flows into gold should continue. Michael Haigh, global director of commodities research for Societe Generale, said that he believes gold prices will reach $4000/oz before the end of the year.

The WGC reports that global gold ETF demand is up to 587.8 tons this year. This compares with a net outflow in 2024 of 6.8 tonnes.

SILVER FOLLOWS BULLISH TRAC

Silver reached its highest price since May 2011 at $47.83 per ounce. The record high was $49.51 in April 2011.

The same macroeconomic forces that drive gold are also driving silver's rally. This includes strong industrial demand, tightness on the spot market, and speculative momentum.

The ratio of gold to silver The price of silver is around 82. This is its lowest level since late October, last year. It signals a relative strength in the value of gold against silver.

Aakash Doshi is the global head of gold strategies at State Street Investment Management. He said that silver was a "catch-up" trade, as it had been outperforming gold in several quarters before mid-2025.

He added that recent CME premiums over London spot prices encouraged delivery into the COMEX System. Nearly 60% of the global demand for the metal is for industrial use. The inclusion of the metal on a draft U.S. list of critical minerals has also sparked speculation about potential tariffs. CME silver stock Since the beginning of the year, the amount of gold has increased by 60% to 530.2 millions ounces. The metal is still on course for its fifth consecutive annual deficit.

(source: Reuters)