Gold and silver surged to fresh record highs, with gold crossing $4,600 (~₹1,40,000) and silver moving past $83 (~₹2,60,000). The rally was driven by a mix of rising geopolitical tensions and growing expectations that the U.S. Federal Reserve will be forced to cut interest rates further. Last week itself, gold ended up nearly 4%, while silver jumped a sharp 12%, as markets reacted to weaker-than-expected U.S. jobs data and an increasingly uncertain global backdrop.

Geopolitical tensions back in focus

Geopolitical risks have once again taken centre stage. Tensions remain high amid escalating unrest in Iran, the ongoing Russia–Ukraine war, the U.S. capture of Venezuela’s President Nicolás Maduro, and renewed signals from US about taking control of Greenland.

Investors are closely watching the protests in Iran, now in their third week, with reports suggesting more than 500 deaths so far. President Donald Trump has warned Iran’s leadership against using force on protesters and hinted at possible U.S. action if the crackdown continues. Iranian officials, in turn, have warned against any U.S. or Israeli intervention and threatened retaliation, including targeting U.S. military bases in the region.

All of this comes at a time when Trump is projecting U.S. power more aggressively on the global stage—ousting Venezuela’s president and openly discussing the possibility of acquiring Greenland, either through purchase or force.

Growing pressure on the Fed to cut rates

U.S. economic data is adding to the case for easier monetary policy. December nonfarm payrolls rose by just 50,000, falling short of expectations, while the unemployment rate edged down to 4.4%. The numbers point to a weakening job market, which, combined with geopolitical risks, firmer oil prices, and rising uncertainty, creates a supportive environment for precious metals.

Markets continue to price in two rate cuts this year, even though the Fed is expected to hold rates steady at its upcoming meeting. Adding to the drama, Fed Chair Jerome Powell said on Sunday that the Trump administration had threatened him with a criminal probe over his Congressional testimony—moves Powell described as an attempt to pressure the central bank into lowering rates. The comments pushed the dollar and U.S. equity futures lower, while gold and silver gained further.

Supreme Court ruling on Trump tariffs in focus

Another major risk event is brewing. There is growing speculation that the U.S. Supreme Court may deliver a ruling on January 14 on the legality of tariffs imposed under emergency powers.

If the court upholds Trump’s authority to impose tariffs without Congressional approval, tariff threats could return quickly—this time aimed not just at China, but Europe as well, potentially linked to U.S. ambitions around Greenland. If the ruling goes the other way and declares such tariffs illegal, markets could see sharp volatility. That said, the administration reportedly already has alternative legal routes lined up to reimpose tariffs.

In either case, precious metals are well positioned. Trade tensions typically weigh on the dollar and push investors toward safe-haven assets like gold and silver, while supporting currencies such as the euro and Swiss franc. An even more intriguing outcome would be if the court places clear limits on presidential powers—something that could make Trump’s policy responses even more unpredictable going forward.

What to watch this week

This week’s economic calendar is packed, with the spotlight on U.S. inflation and consumer data. Tuesday’s December CPI report will be especially important, as it may be the first inflation print unaffected by the government shutdown. That said, geopolitics could easily steal the spotlight. Any Supreme Court decision on tariffs—or fresh developments on the geopolitical front—could end up driving markets more than economic data.

The gold boom began in mid-August around $3400 and reached $4400 by mid-October. The prices then retraced and have been taking support from the uptrendline since. Gold has crossed its previous high resistance of $4570. The next level to watch for is of $4745-50 (78.6% fibbonnicci extension) and $4966-70 (100% fibbonnicci extension).

The Silver rally started from $45 in October, and extended up $82.7 in December 2025. Fibonacci extension suggests that this rally can extend further towards $84, $88, $93 and $99 in the coming few months of 2026 with strong support at $70.

Dr.Renisha Chainani, Head- Research, Augmont