Both precious metals fell Wednesday after the CME Group raised its margin requirements for contracts of gold and silver for the second time in a week to curb volatility. While both metals tumbled on the last trading day of the year, prices remained elevated. Precious metals got a boost last year on geopolitical and economic risk as well as anticipation of future interest rate cuts.
February gold futures fell 1% Wednesday to settle at $4,341.10 an ounce on Comex, and the most-active contract is down 4.7% so far this week. Most global financial markets were closed Thursday for New Year’s Day. Bullion rose 2% in December after gaining 6.5% in November and increasing 3.2% in October. It rallied 64% last year. The metal rose 27% in 2024. The February contract is currently up $12.10 (+0.28%) an ounce to $4353.20 and the spot price is $4340.00.
March silver futures tumbled 9.4% Wednesday to settle at $70.60 an ounce on Comex, and the most-active contract is down 8.5% so far this week. The white metal hit a series of record highs last month. Silver soared 24% in December after increasing 19% in November and rising 3.3% in October. It climbed 141% last year after rising 21% in 2024. The March contract is currently up $2.807 (+3.98%) an ounce to $73.410 and the spot price is $73.24.
Gold in particular has been sensitive to speculation about multiple U.S. interest rate cuts in 2026. Lower interest rates are typically bullish for precious metals, making them a more attractive alternate investment.
The Fed reduced interest rates for a third consecutive time last month to 3.50% to 3.75%.
About 85% of investors are betting that the Fed will keep interest rates unchanged at the next policy meeting at the end of January, according to figures tracked by the CME FedWatch Tool. About 16% expect another 25 basis point cut. The central bank began raising interest rates in March 2022 to fight inflation, ultimately imposing increases of by 5.25 percentage points before beginning rate cuts in 2024.
Precious metals have also soared in recent weeks on geopolitical tensions, including between the U.S. and Venezuela and the ongoing conflicts in Ukraine and Gaza. Precious metals are a traditional hedge against geopolitical and economic uncertainty. Silver has risen on industrial demand and tight supply as it’s increasingly considered a critical metal for electronics and other goods.
Spot palladium fell 2.2% Wednesday to $1,614.50 an ounce and has tumbled 17% so far this week. Palladium rose 11% last month after adding 0.5% in November and rising 14% in October. Palladium gained 74% last year after dropping 17% in 2024. Currently, the spot price is up $33.50 an ounce to $1652.50.
Spot platinum slid 9.3% Wednesday to $2,028.00 an ounce and is down 16% so far this week. It surged 22% in December after climbing 4.7% in November and rising 1% in October. Platinum increased 122% in 2025 after losing 8.4% in 2024. The spot price is currently up $111.70 an ounce to $2135.30.
