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Gold and silver prices surged to unprecedented levels on Monday, propelled by investors seeking safety amid renewed concerns over the U.S. Federal Reserve’s independence and a mix of supportive macroeconomic forces. Spot gold jumped as much as 2.6% to an all-time peak of $4,625.34 per ounce, decisively breaking above the $4,600 mark for the first time. Silver outperformed, rocketing 7.2% to a record $85.73 per ounce.
The rally is underpinned by multiple factors, with heightened institutional uncertainty surrounding the Fed taking center stage. President Donald Trump’s repeated attacks on the central bank and its leadership last year are seen as undermining its ability to combat inflation, a prospect that weighs on the U.S. dollar and Treasuries while bolstering the appeal of non-yielding gold as a store of value.
Further tailwinds include expectations of falling U.S. interest rates and escalating geopolitical tensions, collectively driving funds into precious metals.
The record run builds on an explosive performance in 2025. Gold closed the year with a 65% gain, its best since 1979, while silver skyrocketed 140%. The momentum appears poised to continue as the Trump administration escalates its pressure on the Fed. Current Chair Jerome Powell now faces a threat of criminal indictment after being served with a grand jury subpoena by the Department of Justice.
“We see increased interference with the Fed as a key bullish wildcard for the precious metals in 2026,” said Carsten Menke of Julius Baer Group. He added that the smaller silver market, being more sensitive to moves in rates and the dollar, is “likely to react more strongly to such concerns.”
Charu Chanana, Chief Investment Strategist at Saxo Markets, noted the possible Fed indictment “is a reminder of how many uncertainties markets are juggling — geopolitics, the growth/rates debate, and now a fresh headline-driven reminder of an institutional risk premium.”
Silver is riding gold’s coattails while also getting a significant lift from its own supply-demand dynamics. Fears of potential U.S. tariffs have drained warehouse inventories, echoing the London silver squeeze of October.
BMI, a unit of Fitch Solutions, stated in a Monday report, “We see the deficit in the silver market continuing throughout 2026, primarily on higher investment demand.” It also highlighted that industrial consumption has tightened the physical market to an unprecedented degree.
Speculative fervor in China has added further fuel, with traders and deep-pocketed funds piling into commodities. The demand was so intense that China’s only pure-play silver fund reportedly had to turn away new investors recently.
With the bullish backdrop firmly in place, market observers are setting ambitious price targets.
“Gold’s rally reflects a convergence of political, monetary and geopolitical risks that are reinforcing demand for haven assets. A move toward $5,000 soon seems highly plausible given that backdrop,” said macro strategist Nour Al Ali. HSBC has forecast that gold could hit $5,000 in the first half of 2026.
Nick Cawley, Market Analyst at Solomon Global, echoed this sentiment in a Monday note, projecting gold to reach $5,000/oz and silver to push to $100/oz in H1 2026. “Against this volatile background, and with investors moving away from the U.S. dollar, demand for safe-haven assets continues,” he said, adding that any potential pullback should be seen as a buying opportunity.
On the technical front, Cawley sees initial gold resistance around $4,750/oz but expects it to be overcome en route to $5,000 by summer. For silver, having breached previous highs, he sees a clear path to $100. However, he issued a note of caution: “Anyone trading silver must be aware that price action is set to become increasingly volatile, causing regular 10%+ daily price swings. The higher the price of silver goes, the more volatile it will become.”
