Economy

Precious Metals Reach Record Highs Amid Geopolitical Tensions and Market Uncertainty

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Jan 23, 2026

THE BARE STORY

Precious metal prices surged to historic levels in late January 2026, driven by economic instability and increased demand for safe-haven assets. As of January 23, gold prices exceeded $4,900 per ounce, following a 60% increase in 2025. Simultaneously, silver broke through previous ceilings to trade just above $94 per ounce. Analysts attribute the rally to a mix of global supply deficits, high industrial demand, and investors seeking protection against market volatility.

Nicky Shiels, head of metals strategy at MKS PAMP, linked the rising prices to specific sources of market anxiety. According to Shiels, contributing factors include a federal investigation into Federal Reserve Chairman Jerome Powell, a U.S. military operation in Venezuela, and economic tensions surrounding a U.S. push to control Greenland. These uncertainties have prompted capital reallocation from other sectors into metals, which historically serve as a hedge against systemic financial risk.

Financial professionals note that investors are weighing the benefits of physical ownership against "paper" assets like ETFs. For physical buyers, the choice often lies between bars and coins. Silver bars typically carry lower premiums and are efficient for bulk storage, while government-backed coins offer greater liquidity and recognition despite higher upfront costs. Similarly, experts estimate that physical gold often commands a 5% to 10% premium over the spot price. Advisors generally recommend limiting gold holdings to between 5% and 10% of a portfolio, emphasizing that investment strategies should align with individual goals and liquidity needs.

Same Facts. Different Perspectives.

Two AI models. Two viewpoints. One factual foundation.

Perspective by Grok

• Portfolio allocations to precious metals should remain limited Despite the record-breaking surge, advisors generally recommend that investors limit their gold holdings to between 5% and 10% of their total portfolio. Professionals emphasize that investment decisions should be driven by individual liquidity needs and long-term goals rather than immediate market reactions.

• Physical ownership entails significant premiums over spot prices Experts estimate that buying physical gold often commands a premium of 5% to 10% above the trading spot price, a cost that investors must factor into their returns. Financial professionals note that investors are currently weighing these costs against the benefits of holding "paper" assets like ETFs.

• The form of physical asset affects liquidity and storage For those choosing physical ownership, professionals highlight the trade-offs between bars and government-backed coins. Silver bars are noted for having lower premiums and being efficient for bulk storage, while coins generally offer greater liquidity and recognition despite carrying higher upfront costs.

How it may affect me

As a U.S. reader:

• You may encounter market uncertainty driven by the investigation into the Federal Reserve Chairman and U.S. actions in Venezuela and Greenland.

• If investing in gold to hedge against risk, advisors recommend limiting holdings to 5% to 10% of your portfolio to maintain liquidity and meet long-term goals.

• Purchasing physical gold generally requires paying premiums of 5% to 10% above market rates, a cost you must factor into expected investment returns.

• When buying physical silver, you face a trade-off between bars, which offer lower premiums for bulk storage, and coins that provide better recognition and liquidity.

• Structural global supply deficits and high industrial demand are keeping metal prices elevated, potentially impacting costs in sectors reliant on these raw materials.

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