Editor’s Note
Precious metals have surged, with gold and silver posting significant gains this week and year-to-date. This rebound highlights renewed investor interest amid ongoing market volatility.
Gold and silver prices have staged a strong rebound. On February 13, spot gold rose by 2.39%, reaching $5,042.205 per ounce, with a cumulative increase of 16.76% so far this year. Spot silver rose by 2.81%, quoted at $77.338 per ounce, up 8.05% year-to-date. On the same day, international precious metals futures also closed broadly higher. COMEX gold futures rose by 2.33% to $5,063.80 per ounce, with a weekly cumulative gain of 1.51%. COMEX silver futures rose by 2.10% to $77.27 per ounce, but recorded a weekly cumulative decline of 0.33%. Gold prices have risen for the second consecutive week, while silver prices have continued to trend lower.
Data released by the U.S. Bureau of Labor Statistics showed that the U.S. January CPI fell year-on-year to 2.4%, below expectations, while the core CPI fell year-on-year to 2.5%, hitting the lowest level since 2021. Jonathan Cohn, head of U.S. interest rate strategy at Nomura Securities, believes that although inflation data has improved, the continued improvement in the job market limits the possibility of the Federal Reserve further cutting interest rates. He indicated that some of the repricing in the financial markets is due to changes in risk sentiment rather than the economic data itself.
This view was expressed by Lindsay Rosner, head of multi-industry fixed income investments at Goldman Sachs Asset Management.
Geopolitical tensions have also supported the attractiveness of precious metal assets. U.S. President Trump confirmed that the U.S. military will deploy a second aircraft carrier strike group to the Middle East to pressure Hamas to reach an agreement. Citi analysts pointed out that the current round of gold price increases began in July 2023, during the later stages of the Fed’s rate hike cycle, with the main drivers coming from expectations of a weaker U.S. dollar, central bank gold-buying behavior globally, and geopolitical risk premiums.
Several Wall Street institutions have raised their gold price targets. David Wilson, head of commodity strategy at BNP Paribas, believes that influenced by the macroeconomy and geopolitical risks, the current round of gold’s upward trend is reasonable, and gold prices are expected to rise to $6,000 per ounce by the end of the year. Wilson also noted that although the current gold-silver ratio is below the average of the past two years, it has rebounded somewhat. Gold possesses unique value, while silver cannot provide the same level of risk-hedging function.
This forecast comes from Edward Lee, an analyst at Standard Chartered Bank. Lee emphasized that gold will continue to benefit from geopolitical uncertainty, macroeconomic volatility, and sustained buying by central banks.
(Editor: Zhang Xiaohua)
