AGE Daily Gold Update

AGE Daily Gold Update presents a recap on today's action in the precious metals markets. View archives.

1/2/2025: Gold rallies sharply to start 2025

Source: Bill Musgrave, American Gold Exchange

Austin — New York spot gold gained 1.1% to close near $2,659 on safe-haven inflows driven by acute geopolitical turmoil and apprehension about the economic policies of the incoming Trump administration. Bullion surged 28% in 2024, the most since 2010. Silver jumped 2.3% to finish at $29.62, posting a 23% rise in 2024.

Uncertainty over global politics and domestic policies dominated the first trading day of the new year. Renewed fighting in Gaza and Ukraine underscored the ongoing danger of stubborn wars in Europe and the Middle East, which continue to take their toll in lives and economic growth.

Meanwhile, uncertainty surrounding the promised policies of the incoming Trump administration is also pushing investors toward safety. Huge blanket tariffs against major trading partners like Canada, Mexico, and China have the potential to spark trade wars; mass deportation of immigrants may cause labor shortages. Both could stoke inflation and smother growth.

Benchmark 10-year Treasury yields pulled back as investors bought the perceived safety of government debt. Falling yields support gold by decreasing the opportunity cost for holding it instead of bonds.

The dollar rose sharply, adding 0.7% against major rivals as manufacturing activity in Europe and Asia ended 2024 in weakness, prompting speculation that central banks in China, South Korea, and the Eurozone will have to reduce interest rates more aggressively this year than the Fed.

Gold’s remark able 28% surge in 2024, coming after an impressive 13% rise in 2023, was driven primary by falling global interest rates, acute geopolitical conflict, and aggressive purchases by central banks worldwide. All these influences, to varying degrees, are projected to be active in 2025 as well.

Platinum added 1.7% today and lost 10% in 2024. Palladium picked up 1.5% today but shed 17% last year.

At the New York spot close: gold gained $29.70 to $2,658.90; silver climbed 68 cents to $29.62; platinum rose $14.90 to $980.90; and palladium advanced $13.50 to $916.40 an ounce.