In January, noticeable movements in the precious metals market were propelled by economic and geopolitical tensions, trade policy developments, and supply-chain disruptions.
Gold
Gold prices remained strong, with an upward trajectory starting the month at $2625.95/oz. Gold sneaked in another milestone on the last day of January, peaking at $2804.60/oz, marking a 6.77% monthly increase.
Economic instability remains a key driver for the upward swing, with a spotlight on Canada, which faces a recession due to imposing tariffs, interest rate cuts, and a weakening dollar, increasing the demand for gold.
Central banks, specifically China, continue to drive gold prices as they feverishly add to their reserves. Many analysts predict the demand for gold will continue towards a $3,000/oz milestone in the near future.
Silver
Silver prices also continued upward, trading at an average price of $30 through mid-January and ending at 31.47-oz, marking an 8.59% monthly gain. The Gold-to-Silver Ratio (GSR) edged higher at 89, suggesting that silver remains undervalued compared to gold. This is an indicator that silver is a good buy at this time. Concerns over China’s economic slowdown played a role in the elevated GSR. However, industrial demands for renewable energy technologies and electrical vehicle production remain constant drivers for silver.
While silver remains resilient, it is heading into its fifth year of supply deficits. This is due to increased demand from technology sectors and strained mining production along with ongoing economic and geopolitical uncertainties. These deficiencies, along with demand, could keep silver prices up for the near future.
Platinum and Palladium
Both platinum and palladium had noteworthy gains in January, with platinum increasing by 7.72% to $989.09 and palladium increasing by 10.58%, sustaining the thousand-dollar mark of $1045.66 by month-end. Platinum grew due to steady industrial demand, particularly in hydrogen fuel cell technology and catalytic converters.
Platinum’s growth was partly caused by sanctions the U.S. Treasury imposed on Russian precious metals. Because Russia is one of the largest suppliers of platinum and palladium, the sanctions have significantly impacted the supply chain and demand. As a result, Russia experienced a diminished market share, driving higher platinum prices.
The demand for palladium in emission control for combustion engines remains a constant factor. However, the upcoming trade tariffs could impact palladium if the automotive sector is affected.
Conclusion
January 2025 marked a strong foundation for precious metals markets, with prices climbing amid global economic challenges and increased demand as investors turned to precious metals as safe-haven investments.
Spot price data based on CMI Gold & Silver’s spot price daily feed.
Stay up to date! Sign up to receive daily spot prices delivered to your email.
