Gold and silver prices rose to record highs on Monday as geopolitical tensions combined with bets on US interest rate cuts to prompt a renewed jump in the precious metals.
The price of gold rose as much as 1.9 per cent in early Monday trading, to touch $4,420 per troy ounce. Silver also hit a record, rising as much as 3.4 per cent on Monday to $69.44 an ounce.
Analysts said the intensifying US blockade on Venezuelan oil was a partial explanation for the rising precious metals prices, as investors seek “safe haven” assets. US President Donald Trump is understood to be weighing military action on Venezuelan soil as he raises the pressure on the autocratic President Nicolás Maduro to step down.
“It’s a reminder that geopolitical and debasement worries have the same hedge — gold,” said Arun Sai, senior multi-asset strategist at Pictet Asset Management. “Debasement” refers to the theory that precious metals, such as gold, are a hedge against the eroding value of traditional currencies such as the dollar.
“Investors see gold as a way to hedge those concerns but stay invested,” Sai added, explaining why the geopolitical risk factor was being expressed in commodities rather than stocks or bonds.
After a blistering rally this year, gold and silver are on track for their biggest yearly price jump since 1979, when the Iranian revolution caused a surge in the price of oil. Gold is up 68 per cent and silver has risen 139 per cent so far this year.
Market uncertainty caused by Trump’s sweeping “reciprocal” tariffs and his attacks on the independence of the Federal Reserve prompted investors to pile into the precious metals this year.
Investors have also been increasing their bets on interest rate cuts by the Fed next year. Expectations of lower interest rates support gold prices as investors, expecting a lower return from holding bonds, look to other assets.
“The escalation in tensions between Venezuela and the US may be supporting gold prices at the margin,” said Hamad Hussain, climate and commodities economist at Capital Economics, although he added that “bullish market sentiment” was doing more work to drive the price higher.
Copper, a widely used industrial metal that is seen as a barometer of global economic health, also climbed to a new record high on Monday of almost $12,000 per tonne.
Copper has notched a series of new records since October, due to a combination of supply disruptions and shortage fears, and a massive influx of copper into the US that has depleted stocks elsewhere. Fears that the US administration might impose additional import tariffs in 2026 have continued to drive copper into the country in recent weeks.
Oil prices also rose on Monday as the US pressure on Venezuela intensified. The international benchmark Brent crude rose as much as 1.4 per cent to $61.31 a barrel.
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