Gold and Silver Prices Face Volatility Amid Market Uncertainty
Gold and silver prices have recently exhibited significant volatility after reaching record highs earlier this year. Following a period of substantial gains—gold nearly doubling and silver quadrupling since Donald Trump’s inauguration both metals saw a dramatic decline last week with gold dropping approximately 10% and silver plunging about 28% on Friday. The declines persisted into Monday with gold falling around 4.5% and silver about 6.5%, before some recovery on Tuesday.
The surge in precious metals was driven by global economic uncertainties, geopolitical tensions and a weakening U.S. dollar; factors that traditionally boost demand for safe-haven assets. Trump’s return to the White House has heightened market volatility with his unpredictable policies from tariffs to threats over Greenland fueling investor anxiety. His push for unconventional governance and pressure on the Federal Reserve have contributed to a weakening dollar prompting investors to flock to gold and silver.
Between 2024 and early 2026 gold prices nearly doubled reaching nearly $5,595 an ounce while silver soared to nearly $122 an ounce. Analysts suggest that these soaring prices reflect a broader crisis of confidence in the global economic system, characterized by high inflation and mounting national debts—most notably, the U.S. national debt, which has hit $38 trillion.
Diego Franzin, head of portfolio strategies at Plenisfer Investments, emphasized gold’s unique value: “In a system based on record levels of public and private debt, gold remains the only asset without a counterparty. It provides security because it makes no promises and is not dependent on political decisions.”
Central banks in emerging economies such as China and Turkey have also increased their gold holdings to reduce reliance on the dollar, further fueling demand.
The recent rally peaked on Thursday when gold hit an all-time high of nearly $5,595 per ounce, and silver reached nearly $122. However, the market correction was swift. On Friday, prices plunged roughly 10% for gold and 28% for silver, with declines continuing into Monday. By Tuesday morning, prices had begun to recover, with gold rising about 3.5% and silver approximately 4.5%.
The causes of this sudden crash remain debated. Some analysts attribute it to profit-taking after the parabolic rise, while others suggest that geopolitical developments—such as Trump’s announcement of a new Federal Reserve nominee and hopes for a diplomatic deal with Iran—have reduced the perceived need for safe-haven assets.
Trump’s nomination of Kevin Warsh to lead the Fed was seen as a stabilizing move, alleviating fears of aggressive rate cuts. Meanwhile, prospects of more stable economic conditions and a rising dollar have prompted some investors to sell off precious metals.
Looking ahead, market experts remain cautiously optimistic. JP Morgan analysts project gold could reach $6,300 an ounce by the end of 2026, citing ongoing demand for portfolio diversification. Mark Matthews of Bank Julius Baer noted that once the market stabilizes, investor interest in gold and silver is likely to pick up again, driven by expectations of a continued depreciation of the dollar and increased central bank holdings.
While predicting market movements remains uncertain, the overarching trend suggests that gold and silver will continue to play a vital role as safe-haven assets amid ongoing economic and geopolitical turbulence.
