Why Gold and Silver Prices Are Soaring in 2026

Gold and silver's record-setting performance in 2025 has accelerated into the new year, with prices continuing to climb on the back of supply pressures, rising political risk, and new questions about central bank independence.

The rally gained fresh momentum on Monday when gold prices surged past $4,600 an ounce. The move followed news that U.S. Federal Reserve Chair Jerome Powell is under criminal investigation concerning the $2.5 billion renovation of the Fed's headquarters.

By Wednesday, spot gold was trading near $4,633.46 an ounce. Silver also extended its gains, breaking through the $90 per ounce mark for the first time on Tuesday before climbing another 3.5% to trade at $90.42.

This builds on a powerful trend from the previous year. In 2025, spot gold appreciated by about 65%, while silver skyrocketed roughly 150%. The momentum has not slowed in 2026, with gold already up 7.1% and silver adding 26.6% year-to-date. According to market managers, the fundamental drivers behind this rally remain firmly in place.

Geopolitical Friction and Supply Controls

Analysts point to persistent geopolitical stress as a core pillar supporting precious metals. Daniel Casali, a partner in investment strategy at Evelyn Partners, noted that events like Russia's 2022 invasion of Ukraine and President Donald Trump’s "liberation day" tariff announcements continue to buoy gold.

"When Trump started to raise tariffs, China started to respond, so they pulled out what I would define as a battle between the U.S. and China of resource nationalism," Casali explained.

He said Beijing retaliated against U.S. tariffs by restricting exports of rare earth minerals, a move that highlighted their critical role in American defense, technology, and AI supply chains. These export controls were later expanded to include silver, a vital component for AI hardware, electric vehicles, and other industrial applications in the U.S. and Europe.

Investors are now focused on a potential meeting between Trump and Chinese President Xi in April. "How that goes? No idea," Casali said. "But you bet your bottom dollar export controls are going to be a key discussion point."

Political risk escalated further in early 2026 after the U.S. removed Venezuelan President Nicolas Maduro from power and the White House floated the idea of military action to secure control over Greenland. Casali observed that both Washington and Beijing are positioning their resources for leverage. While China controls rare earths and silver exports, the Trump administration is working to limit Venezuelan oil flows, which are primarily directed to China.

Record Price Targets Amid Shortages and Policy Risk

With these dynamics in play, some experts believe precious metals have much further to run. Ned Naylor-Leyland, an investment manager at Jupiter Asset Management, stated it was "absolutely" possible for gold to hit $5,000 and for silver to exceed $100 this year. He said investors "should assume that that would definitely happen this year" based on current conditions.

Naylor-Leyland identified silver as the market facing the most severe tightness, largely due to Beijing's export controls. "Silver is basically disappearing now to China and India, there's about a $10 premium being paid in Shanghai," he noted, adding that the market is now centered on physical bars rather than screen-based trading.

Silver’s widespread industrial use makes this shortage particularly acute. "The thing about silver is, if you don't have it, you can't build anything," Naylor-Leyland said. "Whether it's electronics or white goods or missiles or cars, you don't have it, you can't have it."

For gold, he identified accommodative monetary policy as a primary catalyst. "The base case with gold is presuming central banks remain dovish," he said. "We're in a rate cutting environment with unconventional policies and chasing down Chairman Powell. Unless they reverse course and start hiking, you can expect gold to do pretty much what it did last year or more."

Paul Syms, head of EMEA ETF fixed income and commodity product management at Invesco, agreed that the trends supporting metals appear even stronger now. He highlighted that the investigation into Powell has ignited fresh concerns over the Federal Reserve's independence, prompting a dozen global central bank heads to issue a statement in his support.

Syms concluded that with persistent worries over the U.S. dollar, budget deficits, lower interest rates, high geopolitical tension, and growing industrial demand for silver, there is no obvious catalyst that would reverse the upward trend in metal prices in the near term.