Gold and Silver Shine Bright in 2025 as Global Uncertainty Fuels Demand

Gold and silver have delivered an exceptional performance in 2025. In just the first half of the year, gold jumped nearly 26% in USD terms, while silver gained about 25%. By October, gold was up more than 60%, and silver had climbed around 45%. This rally has been powered by global economic uncertainty, persistent inflation, and rising demand for safe-haven assets.

Inflation and Interest Rates Driving the Rally

Global inflation continues to stay above target levels. In the U.S., inflation hovers near 2.5%, slightly above the Federal Reserve’s 2% goal. Since December 2024, the Fed has held interest rates steady at 4.25–4.50%, but high debt and economic worries suggest possible rate cuts ahead.

Lower interest rates often make gold and silver more attractive because they do not yield interest. If rates fall and the U.S. dollar weakens, foreign investors may find these metals even more appealing.

Central Banks Boosting Gold Reserves

Central banks worldwide are playing a big role in supporting gold demand. Over the last three years, they have collectively bought over 1,000 tonnes of gold annually. A World Gold Council survey shows that 95% of central banks plan to add more gold to their reserves in the next year.

Emerging markets such as India and China are leading this demand surge. According to UBS, total gold demand in 2025 could reach 4,850 tonnes the highest since 2011. While central banks focus mainly on gold, investor interest in silver ETFs has also risen sharply, adding strength to silver markets.

Supply, Demand, and Industrial Use

Gold’s demand mainly comes from jewelry and investment. Growing middle-class populations in India and China continue to fuel this trend. Silver, however, has a unique position it’s both a precious metal and an industrial commodity.

Around 59% of global silver demand comes from industries such as solar energy, electronics, EV batteries, and medical devices. On the supply side, mining challenges, political risks, and limited investments have kept silver output below demand for seven straight years, pushing prices higher. Gold supply has remained more stable, though refinery and storage issues can still affect prices.

Geopolitical Events Adding to the Momentum

Tensions across the globe have played a key role in boosting gold and silver prices. Conflicts such as the Russia-Ukraine war, Middle East tensions, and U.S.-China-Russia rivalries have increased investors’ preference for safe-haven assets.

In October 2025, new U.S. sanctions on Russian energy and tech restrictions on China triggered another surge in demand for precious metals. Earlier, in June 2025, rising oil prices due to Israel-Iran tensions added to global uncertainty, further lifting gold and silver. History shows that whenever major geopolitical risks rise, investors turn to these metals for safety.

Technical View : Bullish but Volatile

From a technical standpoint, gold prices have been on a strong upward path. The metal crossed $3,500 per ounce in April 2025 and reached $4,381 in October. However, on October 22, gold saw a sudden 6.6% intraday fall, as technical indicators turned overheated.

The RSI crossed 90, and prices traded about 20% above the 200-day moving average, signaling a short-term correction. Silver showed similar bullish patterns but with higher volatility. Overall, charts still suggest strong medium- to long-term momentum with temporary pullbacks likely.

What Lies Ahead

Looking ahead, gold and silver prices could remain steady in the short term. If global conditions stabilize, gold might see modest gains of 0–5% in the coming months. But if inflation or geopolitical risks rise again, prices could climb by 10–15%.

Analysts at UBS believe gold could reach $4,700/oz and silver $55/oz by 2026 under favorable conditions. While forecasts may shift, the key drivers — inflation, interest rates, and geopolitical uncertainty — continue to support strong demand for both metals.