Gold (XAU) has had a remarkable run this year, standing out among major assets, including bitcoin (BTC). But it’s not just gold – its precious counterparts silver, platinum, and palladium have also enjoyed strong gains, outperforming BTC.
While gold’s price has surged by 44% to a record $3,784, silver has gained 53% to $44.32 per troy ounce, according to data source TradingView. If that’s not enough, platinum has gained 60% to $1,452, while palladium has risen 33% to $1,207.
Meanwhile, bitcoin, often touted as digital gold, has failed to keep pace with the precious metals, rising just over 20% to $113,000.
The verdict is clear when considering the year-to-date performance: precious metals, led by gold, remain the go-to safe havens and inflation hedges amid a deteriorating fiscal outlook for advanced economies, rising threat to the Fed’s independence and President Donald Trump’s trade war.
Moreover, central banks diversifying into gold have provided a major tailwind for the metal and its precious counterparts. Global central banks cumulatively hold around 36,000 metric tons of gold, according to a European Central Bank study.
Their buying spree kicked off in the wake of the coronavirus crisis and accelerated further after Russia’s 2022 invasion of Ukraine, both events injecting inflationary pressures into the global economy. Over the past three years, they’ve added more than 1,000 metric tons annually, a record pace that’s more than twice the average of the previous decade.
Bitcoin, however, has yet to earn a place on central banks’ balance sheets, limiting its role as a reserve asset. Additionally, the cryptocurrency’s gains may have been capped by continued liquidations/distributions by old wallets above $110,000. These flows have reportedly offset ETF inflows.
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