Gold surges past $4,400 as rate-cut hopes and safe-haven demand power rally; silver hits record

Gold prices broke through the $4,400-an-ounce mark for the first time on Monday, December 22, buoyed by growing expectations of US interest rate cuts and sustained safe-haven buying. Silver also scaled fresh highs, extending a powerful rally across precious metals.

Spot gold rose 1.7% to $4,410.54 an ounce by 11:39 GMT, after touching an intraday record of $4,420.01. US gold futures for February delivery gained 1.3% to $4,443.90 an ounce.

The yellow metal has surged nearly 68% so far this year, marking its strongest annual performance since 1979. The rally has been driven by robust central bank purchases, heightened geopolitical uncertainty, strong investor inflows and the prospect of lower interest rates.

Silver climbed 2.9% to $69.05 an ounce, having earlier hit a record high of $69.44. The metal is up 139% year to date, supported by a persistent supply deficit, rising industrial demand and strong investment interest.

“Lower rates are supporting demand for real assets like gold and silver,” said UBS analyst Giovanni Staunovo, according to a Reuters report. “But we also see copper at record levels, suggesting investors want broad commodity exposure, likely on expectations that inflation may stay higher for longer.”

Expectations of monetary easing intensified after US Federal Reserve Governor Stephen Miran said on Friday, December 19, that interest rates should be cut as inflation has cooled and policy needs to counter risks to the labour market. Gold, which offers no yield, typically benefits in lower interest rate environments and during periods of economic or geopolitical uncertainty.

Also read: Gold prices hit all-time highs on rate-cut hopes, safe-haven demand

StoneX analyst Rhona O’Connell noted that momentum has also been fuelled by geopolitical tensions. “This is self-fulfilling momentum, but a key fundamental factor is President Trump’s reported use of the word ‘war’ last week in relation to Venezuela, after campaigning on a platform centred partly on ‘peace’,” she said, as cited by Reuters.

UBS expects the rally to continue, with Staunovo adding that gold could climb further next year, targeting levels around $4,500 an ounce.

Other precious metals also saw sharp gains. Platinum jumped 5% to $2,072.01, its highest level in more than 17 years, while palladium rose 3.7% to $1,776.69, touching a near three-year high.