By Ahmad Assiri, Research Strategist at Pepperstone
The driver for both gold and silver is a combination of macro acceptance of higher prices and renewed geopolitical and policy-related risks that is quietly attracting demand for metals.
On the macro side, an anticipated softer dollar is proving supportive, with markets pricing that the Federal Reserve is likely to continue cutting rates into 2026, particularly if the US labour market shows further signs of cooling. Lower rates and a weaker dollar environment naturally improve the relative appeal of precious metals.
Overlaying this, geopolitical frictions have re-entered the narrative. The US seizure of oil tankers linked to Venezuela following President Trump’s remarks about enforcing a blockade on sanctioned oil shipments, has reintroduced energy security and sanctions risk into the market psyche. These developments, while not triggering outright risk-off moves, undoubtedly add to the background demand for gold as a must have hedge.
At the same time, US-China trade relations are in a phase of relative calm, but critical minerals remain a sensitive fault line beneath the surface even without political spotlight. That combination of quieter diplomacy on the surface and unresolved tensions underneath is keeping demand for precious metals well supported. Gold’s move toward the $4,500 level reflects the market’s comfort with higher prices rather than pure speculative. Price action has been orderly, with breakouts followed by consolidation rather than sharp reversals suggesting flows are driven by longer-term positioning and hedging demand rather than short-term momentum chasing.
Silver is responding to many of the same macro forces but with added intensity due to its own supply-demand dynamics. Tight supply conditions, combined with strong investment and speculative interest, are magnifying price moves as silver approaches the $70 level. That is why silver’s rally has been sharper and more volatile than gold’s.
Crucially, neither market is showing clear signs of rejection at these psychological thresholds. Instead of sellers stepping in aggressively, both gold and silver continue to attract buying into strength. This behaviour suggests that $4,500 and $70 are being treated less as hard ceilings and more as reference points within ongoing trends, leaving both metals firmly supported for now and over the holidays.