SunSirs: Gold Surges Past $4,600 — What’s Next for Global Markets?

Driven by factors such as rising expectations of interest rate cuts in the United States and escalating geopolitical risks, international precious metal prices surged on January 12, with both gold and silver prices hitting new historical highs during the trading session.

In terms of external markets, the main COMEX gold futures contract rose more than 2% intraday, reaching a high of $4,612.7 per ounce; the main COMEX silver futures contract rose more than 6% intraday, hitting a high of $84.57 per ounce.

In the domestic futures market, the main contract of Shanghai gold futures rose by more than 3% intraday, reaching a maximum of 1,031.3 CNY per gram; the main contract of Shanghai silver futures rose by more than 14% intraday, and by the afternoon close, it had reached a maximum of 20,998 CNY per kilogram.

The long-term imbalance between supply and demand of physical commodities remains the core driver behind precious metals breaking through historical highs this time. In addition, the recent rebreakage in short-term prices is also due to the sudden escalation of U.S.-Iran tensions, coupled with U.S. President Trump's recent radical remarks such as about occupying Greenland, which have impacted the global market," analyzed Huang Ting, a precious metals analyst at the Rare and Precious Metals Information Department of Shanghai Ganglian. It is estimated that the global supply-demand gap of silver will reach 2,693 tons in 2025, marking the fifth consecutive year of shortage. This is mainly because the increase in supply is limited, while investment demand has grown significantly in recent years. At the same time, the expected fluctuations in manufacturing consumption highlight structural shortages, supporting the upward shift of the price center. The demand for physical delivery of COMEX silver has intensified inventory tensions. In December 2025, the demand for long positions delivery surged, forming a "short squeeze" pattern against short positions and pushing prices to rise faster.

At the same time, expectations of monetary policy easing provide liquidity support. Expectations of the Federal Reserve's interest rate cut cycle are rising, which improves market liquidity and promotes the revaluation of precious metals as safe-haven assets. Macroeconomic risks coupled with escalating geopolitical crises have catalyzed safe-haven demand. The U.S. debt credit crisis has triggered a shake-up in the global credit currency system, and gold and silver, as traditional value anchors, have received systemic support.

Zhuo Chuang Information precious metals analyst Huang Jiaqi also analyzed that the driving force behind the current market rally mainly comes from two aspects. On the one hand, Trump once again pressured current Federal Reserve Chairman Powell on the extent of interest rate cuts, and Treasury Secretary Bentsen expects that Trump will make a decision on the candidate for the next Federal Reserve Chairman around the Davos Forum to be held from January 19 to 23. In addition, the December non-farm payroll data fell short of expectations, and traders are pricing in a more dovish path for subsequent interest rate cuts.

On the other hand, the impact of geopolitical fragmentation continues to ferment. Recently, due to rising prices in Iran, social instability factors have increased, and the United States is considering plans to intervene in Iran. At the same time, there are disputes between the United States and Denmark, as well as between the United States and Venezuela over key resources and territorial issues. Trump's statement on international law has also increased the uncertainty about the prospects of the geopolitical situation, and the market's demand for safe-haven has supported the premium of precious metals.

Huang Jiaqi believes that currently, both gold and silver are at historical highs, with significant short-term sharp increases. The resistance above in the technical form has increased, and in the short term, attention needs to be paid to the negative impact that the rebalancing of the Bloomberg Commodity Index, which reduces the weight of precious metals, and the increase in gold and silver margin ratios by the Chicago Mercantile Exchange may bring. However, in the long term, the Federal Reserve's interest rate cut cycle is not yet over, geopolitical risks remain uncertain, and the de-dollarization tendency in global asset reserves all mean that gold still has room for growth. Additionally, the continued tight circulation of silver in the London market supports the pricing of silver's commodity attributes. In summary, in the short term, we need to be vigilant about corrections caused by macro negative factors and technical factors, but gold and silver still have room for growth in the long term.

Regarding the future market of precious metals, Huang Ting also believes that short-term prices are still in a stage of new highs, but the trading volume and price fluctuations of futures contracts at high levels have increased significantly, and the market is in a stage of intense long-short game, with relatively unstable market sentiment. We need to be wary of price corrections caused by the cooling of macro risks.

However, driven by supply and demand as well as monetary factors, the medium-to-long-term trend of precious metals remains optimistic. The Silver Institute predicts that the silver shortage will persist until 2030, with a cumulative deficit reaching 23,200 tons. Coupled with limited growth in mining investment, this may continue to drive up prices. In terms of gold, global central bank gold purchases continue to grow, and the People's Bank of China has increased its gold holdings for the 14th consecutive month, reflecting the global "de-dollarization" and the revaluation of commodity values. It is recommended to accumulate positions in precious metals on dips, avoiding key macro events and holidays.

Guomao Futures believes that gold and silver may maintain a relatively strong trend in the short term, but fluctuations may still be relatively intensity. This week, it is recommended to pay attention to a series of events such as the US CPI, the ruling on Trump's tariffs, the development of the situation in Iran, the candidate for the new Federal Reserve Chairman, and the results of US tariffs on key minerals. In the medium and long term, the underlying logic of the precious metals bull market remains solid. The continuous rise in the US federal government's debt scale will continue to exacerbate the risk of long-term weakening of the US dollar's credit. Coupled with the fact that the Federal Reserve is still in a rate-cutting cycle, the global geopolitical situation remains complex, and global central banks' gold purchases continue, all of which will continue to support the steady upward movement of the gold price center.

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