Gold swung between gains and losses — following a sharp sell-off that swept the broader the precious metals complex at the end of last week — as signs of easing US-China tensions bolstered sentiment across markets.
Bullion fluctuated before trading little changed as Asian markets opened Monday, extending the volatility that followed Friday’s 1.7% drop — the steepest daily loss since May. Silver retreated as much as 1.2% before trimming losses, after closing 4.3% lower in the previous session on signs that a squeeze in London stockpiles may be easing.
Technical indicators, including the relative strength index, show that a ferocious rally for precious metals that began in August — and pushed gold and silver to fresh all-time highs last week — may be overheated, setting the stage for pullbacks.
Traders are now focused on upcoming discussions between the US and China, after President Donald Trump late last week expressed optimism that talks with Beijing officials could yield an agreement to defuse the trade crisis, calling his threatened high levies unsustainable. Tangible signs of progress may cool demand for haven assets, such as gold and silver.
Still, investors remain uneasy about credit risks at US financial institutions after two regional lenders last week revealed loan troubles tied to alleged fraud.
The problems at Zions Bancorp and Western Alliance Bancorp — both due to report results this week — may offer an early test of whether risky lending practices are emerging.
Precious metals have been on a tear this year, with gold registering a ninth straight week of gains.
Prices are up more than 60% so far in 2025, underpinned by central-bank buying and inflows to exchange-traded funds. It’s also benefited from soaring demand for havens in the face of geopolitical and trade tensions, rising fiscal and debt levels, and threats to the Federal Reserve’s independence.
Prices of gold may climb as high as $5 000 an ounce in 2026 as a new group of institutional and high net-worth individuals join the rally, HSBC Holdings Plc analyst James Steel said in a research note on Friday. That’s also likely to increase market volatility next year, he added.
Silver, meanwhile, has run even harder — surging almost 80% this year — with gains driven by some of the same macro factors supporting gold. In London, a lack of liquidity sparked a worldwide hunt for the metal as benchmark prices soared above futures in New York.
Over the past two weeks, more than 20 million ounces of silver have been withdrawn from warehouses linked to the Comex futures exchange in New York.
Much of that is likely headed to London, where it should help ease tightness.
The price gap between the two trading hubs remains wide at about $1.20 an ounce, though that’s much narrower than a spread of as much as $3 last week. There was also a hefty 10 million ounce outflow from silver-backed ETFs on Thursday.
Spot gold was little changed at $4 257.37 an ounce at 9:16 a.m. in Singapore. The Bloomberg Dollar Spot Index was flat. Silver edged up 0.2% to $52.0104 an ounce — after touching an all-time high of $54.4796 an ounce on Friday. Platinum fell, and palladium gained.
BLOOMBERG