Gold, Silver End Year on Historic Surge

Gold and silver have closed the year with sharp price swings, capping a year in which both metals are on course for their strongest annual gains since 1979.

Gold prices jumped by more than 60 per cent in 2025, reaching a record high above $4,549 (£3,378) an ounce before easing after Christmas to about $4,330 on New Year’s Eve.

Silver also recorded a strong performance, trading at around $71 an ounce after climbing to an all-time high of $83.62 earlier in the week.

Several factors drove the rally, including expectations of further interest rate cuts, increased gold purchases by central banks, and heightened demand for so-called safe-haven assets amid global tensions and economic uncertainty.

Rania Gule of trading platform XS.com said a combination of economic, investment and geopolitical factors has fuelled the surge in precious metal prices. She identified expectations of additional US Federal Reserve interest rate cuts in 2026 as the main driver.

Central banks worldwide also boosted demand by adding hundreds of tonnes of gold to their reserves this year, according to the World Gold Council.

Daniel Takieddine, co-founder of Sky Links Capital Group, attributed silver’s rise to supply constraints and strong industrial demand. He noted that China, the world’s second-largest silver producer, has announced restrictions on silver exports.

In October, China’s Ministry of Commerce said it would limit exports of silver, tungsten and antimony to strengthen resource and environmental protection. Reacting to the move, Tesla chief executive Elon Musk warned on social media that silver is vital for many industrial processes.

Takieddine also pointed to strong investment inflows into precious metals through exchange-traded funds (ETFs), which allow investors to gain exposure without holding physical bullion.

Looking ahead, Gule expects gold prices to continue rising in 2026, though at a steadier pace than in 2025. Takieddine said silver could also post further gains but cautioned that any rallies may be followed by sharper corrections.