Precious metals have kicked off 2026 with a strong start following last year's rapid ascent, as silver prices hit a record high and gold climbed in tandem, supported by weaker-than-expected U.S. inflation data which bolstered the case for further interest rate cuts, against a backdrop of ongoing geopolitical tensions.
The white metal surged as much as 3.5% to touch $89.9965 per ounce, while gold traded near its historical peak.
U.S. core inflation figures for December did not come in as high as feared, although economists noted the data was artificially suppressed due to a record-long government shutdown at the end of last year.
Gold prices are hovering close to their all-time highs.
Renewed market concerns over the independence of monetary authorities were sparked by the potential criminal prosecution facing Federal Reserve Chair Powell.
Global central bank governors have expressed support for Powell, while JPMorgan Chase CEO Jamie Dimon suggested that political interference could prove counterproductive.
Safe-haven demand has also been fueled by U.S. President Donald Trump's capture of a Venezuelan leader, renewed threats to occupy Greenland, and violent protests in Iran that could potentially topple the Islamic regime.
Citigroup analysts this week raised their three-month price forecasts for gold and silver to $5,000 per ounce and $100 per ounce, respectively.
Silver outperformed gold last year, surging nearly 150%, boosted by a short squeeze in October and persistent supply tightness in the London market.
Traders are awaiting the outcome of the U.S. Section 232 investigation, which could lead to tariffs being imposed on silver.
Concerns over potential tariffs have caused metal to be held up in U.S. warehouses, further tightening global inventories.
As of 10:25, spot gold was up 0.8% at $4,621.92 per ounce.
Silver advanced 3.2% to $89.7457, while platinum and palladium also posted gains.
The U.S. Dollar Spot Index was flat after rising 0.2% on Tuesday.
