Gold and silver prices are seeing almost historic volatility, shocking casual investors and industry watchers at the same time. The financial consultant Paolo Pasquariello estimates that gold prices may see significant moves in 2026. A combination of a turbulent bond market and a weakening U.S. dollar is fueling this uncertainty. As such, non-currency assets, like precious metals, are starting to feel the effects.
Market conditions in 2025 set the stage for a stunning turn of events for both gold and silver. Gold prices doubled as they had in the previous metals boom, while silver prices more than tripled with an astounding 160% increase. By contrast, the S&P 500 Index soared by 17% over the same time frame. As we know, gold has a long tradition as a safe-haven asset, and investors flock to it during periods of market stress. An analysis co-authored by Campbell Harvey in 2025 underscores that this trend is supported by decades of evidence showing gold’s resilience during stock market downturns.
The recent market swings in both gold and silver markets serves as a chronic reminder of the unparalleled volatility intrinsic in gold and silver commodities. Gold prices have spiked in at least eight of the last eleven major stock market sell-offs. This has been the trend since the late 1980s. From a narrative perspective, this trend reinforces the perception of gold as a hedge against financial turmoil. Both gold and silver prices are subject to great instability, especially when investors flood the market at peaks.
Just as financial markets struggle with uncertainty, the forward path of interest rates continues to be clouded in any sort of clarity. The Federal Open Market Committee (FOMC) was recently shown to be divided among its members on the appropriateness of cutting interest rates. In the most recent quarter-point cut, three members voted against it. The Federal Reserve’s benchmark rate is at a record-high range of 3.5%–3.75%. This is a drastic change from the 0% rate that was set when the COVID-19 pandemic began. Pasquariello noted,
“It looks like there is a significant split at the Federal Reserve about whether to cut interest rates or not.”
This division may be making things even worse on gold and silver prices, while investors are trying to make sense of the effects of continuing economic readjustments. High costs of borrowing have forced many investors to reassess their portfolios. In response, we’ve seen them look to gold and silver as a safe haven from financial instability.
This drop took investors by surprise before the market righted itself, with silver bouncing back nearly 8% in midday market on Tuesday. Our friend Jim Wyckoff made note of this dramatic shift, saying,
“These were some of the worst one-day losses in the history of trading in both gold and silver going back 50 years.”
This kind of mercurial action is a sign of deep underlying instability in the commodity space. Wyckoff warned that extreme price volatility can be the hallmark of the final stages of a long-developed bull market run.
Given the global situation, demand for silver and gold has skyrocketed. Just as the ongoing crisis has investors flocking to these metals, further showing their reputation of being safe-haven assets. Pasquariello emphasized this point, stating,
“People buy gold and silver for a safe haven.”
Markets are dynamic by nature. As these dynamics continue to evolve, gold and silver will increasingly prove to be indispensable components of investment strategies, particularly for investors seeking stability amidst global financial turbulence.
