Precious Metals Rally Amid Geopolitical Tensions and Economic Uncertainty
Gold prices reached $4,472 per ounce, marking a 1.3% decline for the session but a significant annual increase of about 70%, the largest gain since 1979. Silver prices briefly surged above $80 per ounce before retreating approximately 3.3% to around $76. This marks a rise from $56 per ounce at the start of December and $29 per ounce at the beginning of 2025. The rally in precious metals is driven by expectations of US Federal Reserve rate cuts in the coming year and as a hedge against geopolitical and fiscal uncertainties, with supply concerns adding further momentum.
Brent crude oil prices rose by about 1% to $61.25 per barrel, influenced by tensions in the Middle East and ongoing peace talks in Ukraine. Asian equity markets showed mixed performance, with South Korea's Kospi index rising 2.2% to a two-month high, Taiwan's market increasing by 0.9%, and the MSCI Asia-Pacific index up 0.2%.
In geopolitical developments, former US President Donald Trump met Ukraine's President Volodymyr Zelenskyy in Florida for a two-hour discussion. Following their meeting, reports indicated that a draft Ukraine peace agreement was about 95% complete, though issues concerning the Donbas region remain unresolved. Meanwhile, unrest in the Middle East continues, highlighted by Saudi air strikes in Yemen and Iran's declaration of full-scale war against the US, Europe, and Israel.
