Silver Hits Fresh High Above $84, Gold Breaks Record After Trump Flags Possible Action on Iran

Silver surged to a record high above $84 an ounce on Monday, while gold also hit an all-time high above $4,600 per ounce. The rally came as investors sought safety amid escalating geopolitical tensions and concerns over the independence of the U.S. Federal Reserve.

The move follows reports that U.S. President Donald Trump is considering military options in Iran, intensifying global uncertainties. These developments, along with ongoing tensions between Russia and Ukraine, have increased the risk-off mood in global markets.

Precious metals, particularly silver and gold, have been bolstered by growing expectations of Fed rate cuts and declining confidence in the U.S. dollar. Analysts suggest the current environment supports further upside for the metals.

Why the Move Happened

The escalation in U.S.-Iran tensions has heightened geopolitical risks, pushing investors toward safe-haven assets. Reports indicate that Trump has signaled potential military action in response to Iranian unrest and potential threats to U.S. interests.

Meanwhile, the U.S. Department of Justice has served the Federal Reserve with subpoenas related to its building renovation project, raising concerns about the central bank's independence. This has contributed to the flight to gold and other non-yielding assets.

The U.S. labor market also played a role. December's nonfarm payrolls data showed weaker-than-expected job growth, reinforcing expectations of earlier and more aggressive Fed rate cuts. These developments are favorable for gold and silver, which do not produce income and benefit from declining real yields.

How Markets Reacted

Gold prices rose to a record $4,600 per ounce, while silver reached an all-time high of $84.59 per ounce. The rally was supported by a combination of geopolitical tensions, regulatory uncertainty, and economic data suggesting a slowing labor market.

Investors are also reacting to the broader uncertainty surrounding the upcoming U.S. Treasury data and the potential for further Fed easing. The CME Group's FedWatch tool currently puts the probability of a March rate cut at about 30%.

The surge in precious metals was also driven by structural supply constraints, particularly in silver. Limited physical inventories, China's export restrictions, and rising demand from clean energy and technology sectors have all contributed to the tightening of the silver market.

What Analysts Are Watching

Analysts are closely monitoring the U.S. Consumer Price Index (CPI) data for December, which will provide further insight into the Fed's rate-cut trajectory. The data could influence the likelihood of rate cuts in early 2026.

Technical indicators also suggest continued momentum for silver. The metal is currently trading above key moving averages, with resistance levels at $80 per ounce and beyond. A break above $80 could signal further gains.

Gold, too, is showing strong technical support, with momentum indicators and moving averages reinforcing the bullish trend. Analysts are watching for signs of overbought conditions but note that strong volume and conviction in the move suggest continued demand.

Investors are also keeping a close eye on geopolitical developments, particularly in the Middle East. Any escalation in U.S.-Iran tensions could further strengthen demand for safe-haven assets like gold and silver.

The sustainability of the rally will depend on a combination of macroeconomic data, central bank actions, and geopolitical events. Analysts remain cautious but bullish on the long-term outlook for precious metals, particularly in a low-interest-rate and high-uncertainty environment.