Gold and Silver Gain After New Year’s Eve Drop

 

Gold and Silver Gain After New Year’s Eve Drop

(Bullion News Network) – The spot price of silver gained on Friday, regaining a bit of ground after the pre-holiday drop. On Wednesday, silver retreated by $4.66 (6.11%), falling to less than $71.75 per troy ounce. After New Year’s Day, silver gained approximately $1.40 per troy ounce, reclaiming ground above $73/ozt as traders returned from the holiday. Gold largely moved sideways, marking three consecutive days of little movement in the market. Gold did log a gain on the day, adding nearly $14.50 per troy ounce. The price action favored silver, driving the gold-silver ratio more than 0.80 points lower to below 59.5:1. The GSR itself saw considerable volatility this week, reaching a high of 60.32 and a low of 56.90, a difference of 3.42 points. The spot price of platinum increased again, adding over $87 per troy ounce. Palladium lagged behind, gaining less than $19/ozt. The price action extended the gap between the two metals, which now sits at approximately $495 per troy ounce.

Silver’s volatility was the big story at the end of 2025. Earlier this week, CME Group once again hiked margins for precious metal futures after an especially volatile week. The move was intended to provide a cushion against volatility and ensure traders are able to pay their margin calls on futures bets, but the news also signaled that the silver market’s volatility may be sticking around for a while. Comparably, gold prices modulated following a large drop on Monday that saw the metal shed 4.35% per troy ounce.

Rate cut speculation is expected to play an outsized role in both markets heading into January. The Federal Reserve is set to meet for the first time of 2026 on Jan. 28. Given December’s divisive meeting, investors will be watching closely for cues about where the FOMC may vote at this pivotal meeting. CME FedWatch projects that the probability of the FOMC cutting rates for a fourth consecutive time is 17.2%, down from 17.7% one week ago and 27.3% on Dec. 2. The FOMC’s December meeting minutes were released on Tuesday and further reinforced the difficulty of the central bank’s path as it attempts to balance risks to both employment and inflation.

Some participants suggested that, under their economic outlooks, it would likely be appropriate to keep the target range unchanged for some time after a lowering of the range at this meeting. A few participants observed that such an approach would allow policymakers to assess the lagged effects on the labor market and economic activity of the Committee’s recent moves toward a more neutral policy stance while also giving policymakers time to acquire more confidence about inflation returning to 2 percent.

Next Friday, traders will be able to review the December U.S. employment report. Forecasters expect the labor market to cool, with the median forecast predicting 54,000 jobs added, compared to November’s 64,000. The unemployment rate is also expected to jump from 4.6% to 4.7%. As the Federal Reserve attempts to improve the employment market without driving consumer prices higher, the Dec. 9 report should be an important piece of data for voting members of the Federal Open Market Committee. A fresh inflation report will be published on Jan. 13 with the Consumer Price Index (CPI), one of the Fed’s preferred inflation gauges. These two reports will be the first big test of 2026 for the FOMC’s easing monetary policy.

Gold and silver finished 2025 strong. With major elections and multiple potentially contentious FOMC meetings on the docket for 2026, traders are bracing for what could be another year marked by rabid safe haven demand and heightened volatility in precious metal markets.