Precious Metals Outperform Traditional Assets as Dollar Weakens
Gold and silver have delivered historic gains this year, with combined market capitalization surging by $16 trillion. Gold's performance quadrupled the S&P 500's returns, while silver soared eightfold. The rally began with the US dollar's 9% year-to-date decline—its worst annual showing since 2017.
Federal Reserve rate cuts in September accelerated the dollar's weakness. Market turbulence intensified when former President TRUMP called for sub-1% interest rates on December 12. Meanwhile, Shanghai silver prices hit $85/oz—$5 above global benchmarks—ahead of China's 2026 export restrictions requiring special licensing for shipments.
The People's Bank of China reported 118 tonnes of silver purchases in Q3 2025, though Goldman Sachs suggests actual figures may be higher. Silver's 175% annual gain marks its longest monthly winning streak since 1980, with prices up 41% this month alone—potentially the strongest December performance since 1979.
