Precious metals continue to benefit from elevated risk awareness linked to global trade disruptions and energy-related supply concerns. Recent legislative moves affecting shipping and commodity flows in key producing regions have added a layer of uncertainty to global markets, prompting investors to rotate into assets traditionally viewed as stores of value.
In thin holiday trading conditions, this defensive positioning has amplified flows into both gold and silver, reinforcing their appeal as macro hedges rather than purely speculative instruments.
Monetary Policy Expectations Drive Investor Positioning
Expectations of easier monetary policy remain a central driver. Markets are increasingly pricing in multiple Federal Reserve rate cuts in 2026 as inflation trends soften and labor market momentum shows signs of cooling. Lower interest rates tend to favor non-yielding assets such as gold and silver, reducing the opportunity cost of holding them.
According to CME FedWatch data, rate-cut probabilities have shifted meaningfully over recent weeks, reflecting growing confidence that the policy tightening cycle is complete.
Strong Growth Data Temper Enthusiasm
That support has been partially offset by resilient US economic data. The Bureau of Economic Analysis reported that the US economy expanded at a 4.3% annualized pace in the third quarter, well above consensus forecasts. Robust growth typically underpins the US dollar, which can limit upside momentum for precious metals.
At the same time, softer consumer confidence readings, with the Conference Board index slipping to 89.1 in December, suggest underlying caution among households.