Gold and Silver Prices Hit Records Amid US-China Tensions and Credit Risk Fears

Precious Metals Rally as Investors Flee to Safe Havens

Gold and silver prices have surged to record highs, driven by renewed US-China tensions and deepening fears about credit quality. On Friday, gold climbed as much as 1.2% to $4,379.96 an ounce, marking its biggest weekly gain since 2020. Silver also reached a historic peak of $54.3775 before retreating slightly, signaling widespread safe-haven demand.

Traders are increasingly betting on a major interest rate cut by the Federal Reserve before year-end. Chair Jerome Powell hinted at another quarter-point cut this month, which could further boost non-yielding assets like bullion. Meanwhile, delays in US economic data due to the government shutdown have only heightened uncertainty, further lifting demand for gold and silver.

Two US regional banks recently reported loan irregularities linked to potential fraud, shaking market confidence. Investors responded by shifting capital into safe assets, especially precious metals. At the same time, China’s Commerce Minister blamed the US for worsening trade ties and warned against decoupling—further escalating geopolitical risks.

Gold and Silver Demand Surges Amid Liquidity Crunch and Global Trade Pressures

The precious metals rally isn’t just driven by macro headlines. A physical squeeze in silver markets is fueling price spikes globally. Over 15 million ounces of silver exited Comex-linked warehouses in just one week. Much of that supply is likely headed to London, where liquidity remains tight.

At the same time, silver ETFs attracted nearly 11 million ounces of inflows in the same period. These moves have drained physical inventories and pushed benchmark spot prices above futures contracts—an unusual inversion that highlights market stress.

Gold’s rally, up over 65% year-to-date, has been fueled by rising central bank purchases, strong ETF demand, and broader geopolitical risk. Sanctions involving Chinese firms, expanding US export controls, and growing fiscal instability are all reinforcing the bullish trend. As global trade becomes more fragmented and debt levels surge, gold continues to attract capital as a trusted store of value.

SuperMetalPrice Commentary:

The surge in gold and silver prices reflects more than short-term fear—it signals a deeper shift in investor behavior. As central banks navigate inflation, trade conflict, and fiscal uncertainty, metals with intrinsic value are regaining their monetary appeal. The Fed’s potential rate cuts, combined with US-China tensions and fragile credit markets, create a powerful backdrop for sustained precious metal strength. Investors and analysts should closely monitor ETF flows and warehouse inventories, especially in silver, which may remain volatile due to ongoing physical shortages and liquidity shifts.