Precious metals achieve their best annual performance since 1979, with gold reaching new highs amid volatility

The last trading day of 2025, gold and silver diverged in their trends. Spot gold retreated to $4,320 per ounce, while silver hovered around $71 per ounce. Although trading was somewhat weak at the close of the session, the performance for the entire year remains dazzling—this is the strongest annual gain for precious metals in over four decades.

Market Drivers Behind Increased Volatility

As the year-end approaches, declining market participation has led to lighter trading volume, resulting in increased fluctuations in precious metal prices. The international futures exchanges raised margin requirements twice, reflecting rising risk management needs in the market. The pattern of a sharp drop on Monday, a rebound on Tuesday, and renewed pressure on Wednesday truly depicts current market sentiment.

Geopolitical and Monetary Policy Resonance

The volatility in gold is supported by deeper logic. Ongoing escalation of geopolitical tensions has strengthened the appeal of safe-haven assets. Meanwhile, the Federal Reserve’s rate-cut cycle provides macro support for gold and silver—low interest rate environments make non-yielding assets more competitive.

Developed economies facing stubborn inflation and debt pressures further trigger market concerns over asset safety. This wave of worry continuously channels funds into traditional safe-haven tools, pushing precious metal prices higher.

The annual increase in precious metals’ prices has reached a new high since 1979, a result of multiple factors working together—reflecting both the market’s hedging needs against uncertainty and investors’ renewed recognition of the value of traditional assets.