Gold hovers around $4,000, silver holds below $60 — has the shimmer worn off the precious metal rally?
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- Gold spot prices hovered around $3,990/oz on Thursday, down roughly 7.5% year-to-date, after briefly breaking back above the $4,000 threshold before retreating again.
- Silver traded at $57.49/oz, down nearly 20% YTD, after suffering its biggest single-day loss since the 1980s at the end of January.
- Both metals had surged 66% (gold) and 135% (silver) in 2025, but the rally turned volatile in early 2026 as the apparent end of the U.S.-Iran war eroded gold's safe-haven appeal.
- Macquarie strategists attributed the retreat to a more hawkish Federal Reserve, noting new Chair Kevin Warsh's first meeting took a "hawkish tone" and that a Q4 rate hike is now fully priced in.
- The European Central Bank and Bank of Japan both raised interest rates this month in response to the energy shock from the Iran war.
- Macquarie forecasts an average 2026 gold price of $4,641/oz (a 35% annual gain) but projects prices falling 9.5% to $4,200 in 2027, with silver reaching $70/oz in Q4 before easing to $65 by end-2027.
- The World Gold Council's annual central bank survey found nearly 90% of respondents expect global gold reserves to increase over the next year, even as Wall Street analysts have slashed near-term price targets.
Why it matters: The metals rally that defined 2025 has flipped: gold is now down roughly 7.5% YTD and silver down about 20%, with Macquarie forecasting a 9.5% drop to $4,200 in 2027. For investors, the signal is that the safe-haven and inflation-hedge theses now compete directly with a hawkish Fed under Warsh and a stronger dollar — making precious metals a macro pair trade against rate expectations, not a one-way bet.
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