Gold and Silver Reach Record Highs Amid Geopolitical Tensions and Rate Cut Expectations
Gold prices have surpassed $4,400 per ounce, trading at $4,417.53 with a 1.8% increase on the day. Silver also reached a record high, rising 3% to $69.14 per ounce. This surge places gold on course for its best year since 1979, having increased by 68% since January 1.
Investors are turning to safe-haven assets amid ongoing geopolitical tensions and expectations of looser monetary policy, with US markets pricing in two 25 basis-point rate cuts anticipated in 2026. These rate-cut bets are further supported by softer-than-expected US inflation and jobs data.
Tensions have intensified particularly around Venezuela, where the US has seized two vessels in international waters and pursued a third as part of a broader oil blockade. President Donald Trump announced a 'total and complete' blockade on sanctioned Venezuelan oil tankers.
Despite the strong rally, Capital Economics has cautioned that while gold may reach new highs in 2026, fundamental factors could cause prices to retreat to approximately $3,500 per ounce by the end of the year.
