Precious metals rebounded on Tuesday after suffering sharp losses in the previous session, as markets refocused on geopolitical and economic risks, reviving gold’s rally and capping its strongest annual performance since 1979.
Spot gold rose 0.8 per cent to USD 4,364.70 per ounce by 2:07 p.m. ET (1907 GMT). On Monday, gold recorded its largest single-day percentage decline since October 21, as profit-taking pushed prices down from Friday’s record high of USD 4,549.71.
U.S. gold futures settled 1 per cent higher at USD 4,386.30 per ounce.
“We saw very extreme volatility yesterday, with strong upside action during Asian trading followed by substantial profit-taking,” said Peter Grant, Vice President and Senior Metals Strategist at Zaner Metals. “However, conditions have stabilised somewhat today, and the broader trade remains generally favourable.”
Gold, traditionally viewed as a safe-haven asset, has surged 66 per cent so far in 2025—its steepest annual rise in more than four decades—driven by a combination of easing interest rates, heightened geopolitical tensions, strong central bank purchases, and increased inflows into bullion-backed exchange-traded funds.
Minutes from the U.S. Federal Reserve’s latest two-day meeting revealed that policymakers agreed to cut interest rates in December only after a nuanced debate over risks facing the U.S. economy. The Fed is scheduled to meet again on January 27–28, with investors currently expecting interest rates to remain unchanged.
Geopolitical uncertainty also continued to support gold prices. Grant noted that markets remain sceptical about the prospects of a Russia–Ukraine peace deal, while broader geopolitical risks remain elevated. Russia has accused Ukraine of attempting to attack President Vladimir Putin’s residence and has vowed retaliation, a claim Ukraine has denied as baseless.
Meanwhile, silver surged 7.3 per cent to USD 77.48 per ounce, after hitting an all-time high of USD 83.62 on Monday before recording its largest daily drop since August 2020. Silver has climbed an extraordinary 168 per cent this year, driven by its inclusion on the U.S. critical minerals list, ongoing supply deficits, and rising industrial and investor demand.
Platinum rose 5.1 per cent to USD 2,216.45 per ounce, having touched a record high of USD 2,478.50 on Monday before suffering its largest-ever one-day decline. Palladium gained 1.6 per cent to USD 1,639.08 per ounce, rebounding after plunging about 16 per cent in the previous session.
Source: Reuters
— Agencies
