Gold, silver recover some ground after sharp plunge
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Gold has staged a stellar run in 2025, climbing 66 per cent so far this year, while silver has gained 154 per cent in the year to date, far outpacing gold.
PHOTO: ST FILE
NEW YORK – Gold and silver pared losses on Dec 30, after a sharp pullback a day earlier from record highs took some froth off the precious metals’ searing rally in 2025.
Spot gold fell as much as 5 per cent on Dec 29, marking the biggest intraday drop since Oct 21, and the second time in 2025 the precious metal plunged that much in one day. Silver plunged 11 per cent in its biggest intraday decline since September 2020.
Both metals recovered some ground in Asia trading on Dec 30, with spot gold up 1.1 per cent at US$4,378.29 per ounce as at 1.41pm in Singapore. Spot silver was up 3.7 per cent at US$74.85 per ounce.
Gold has staged a stellar run in 2025, climbing 66 per cent so far in 2025, with interest rate cuts, bets of further US policy easing, geopolitical conflicts, robust demand from central banks and rising holdings in exchange-traded funds (ETFs) fuelling the rally.
Silver has gained 154 per cent in the year to date, far outpacing gold, propelled by its designation on the critical US minerals list, supply constraints and low inventories amid rising industrial and investment demand.
“I’m expecting the longer-term rally to continue for both gold and silver, with price targets in the next six months at US$5,010 per ounce for gold and US$90.90 for silver,” said Mr Kelvin Wong, senior market analyst at Oanda.
Precious metals historically post an extremely strong end-of-year rally into the new year. Gold delivered gains of around 4 per cent in that period over the last 10 years, while silver has typically advanced almost 7 per cent.
Silver’s sharp reversal on Dec 29 came hours after soaring above US$84 an ounce as surging Chinese investment demand pulled the metal higher. Premiums for spot silver in Shanghai rose above US$8 an ounce over London prices, the biggest spread on record.
Some exchanges are moving to rein in risk. The margins for some COMEX silver futures contracts will be raised from Dec 29, according to a statement from CME Group – a move that China Futures analyst Wang Yanqing said will help reduce speculation.
When an exchange raises margin requirements, traders have to put up more cash to keep their positions open. Some speculators do not have the extra money, so they are forced to shrink or close their trades.
The latest silver rally came just two months after the London silver market suffered a full-blown squeeze as flows into ETFs and exports to India eroded inventories that were already critically low. London’s vaults have seen significant inflows since then, but much of the world’s available silver remains in New York as traders wait for the outcome of a US probe that could lead to tariffs or other trade restrictions.
Spot platinum rose 3.1 per cent to US$2,174.91 per ounce. On Dec 29, it logged its biggest one-day drop ever after touching an all-time high of US$2,478.50.
Palladium lost 0.2 per cent to US$1,614.0 per ounce, after its value dropped by 16 per cent on Dec 29. BLOOMBERG, REUTERS
