Gold and Silver Prices Surge: New Year, Same Risks, And What Comes Next

Precious Metals Market Review & Outlook: 2025 & 2026 – CPM Group Analysis (January 2, 2026)

Key Concepts:

• Annual Average Price: The preferred metric for long-term investors, miners, industrial users, and central banks, as opposed to peak intraday prices.
• ETF Holdings: Exchange Traded Funds – a key indicator of short-term investment demand in precious metals, particularly from momentum investors.
• Exogenous Factors: External factors (political, economic, social) impacting commodity prices, beyond specific metal fundamentals.
• Silver Institute Data vs. CPM Group Data: A critical distinction regarding silver supply/demand balances, with CPM Group asserting the Silver Institute inflates demand figures.
• Sovereign Wealth Funds vs. Central Banks: Differing investment horizons and motivations for gold holdings.
• Energy Transition: The long-term shift towards renewable energy sources, impacting platinum group metals (PGMs) demand.

---

I. 2025 Performance Review – Precious Metals Prices & Investment Demand

Jeffrey Christian of CPM Group provides a review of 2025 precious metals performance as of January 2nd, 2026. Significant price increases were observed across the board:

• Gold: Rose 62% from $2,669 at the start of the year to $4,341 by Wednesday (December 30th, 2025). Annual average price increase: 44%.
• Silver: Experienced a substantial 136% increase. Annual average price increase: 42%. Reached a record intraday high of $82 on December 29th, 2025, with a $12.46 spread in the March Comex futures contract on that day.
• Platinum: Increased by 120%, reaching new record highs. Annual average price increase: 34%.
• Palladium: Rose 81%, but did not reach the highs seen in early 2022 following the Russian invasion of Ukraine. Annual average price increase: 19%.

All four metals – gold, silver, platinum, and palladium – achieved new record highs during 2025. However, Christian emphasizes the importance of annual average prices for long-term analysis, citing examples of silver reaching $50/oz in 1980 and 2011, but averaging significantly lower ($21 and $35 respectively). CPM Group projects prices on a monthly, quarterly (8 quarters), and long-term (10 years, to 2050 for platinum/palladium) basis, in both nominal and real terms.

II. ETF Flows & Investor Behavior

A significant portion of the price increases in 2025 was driven by investment demand, particularly through Exchange Traded Funds (ETFs).

• Total Metal Added to ETFs (Full Year 2025): 21.7 million ounces of gold, 203 million ounces of silver, 257,000 ounces of platinum, and 474,000 ounces of palladium.
• Second Half Surge: Platinum, palladium, and silver saw substantially higher ETF inflows in the second half of 2025 compared to the first half, as investors shifted capital into these metals after they began to lag gold’s initial gains. (Silver: 82 million ounces H1 vs. 122 million ounces H2).
• ETF Investor Profile: CPM Group notes that many ETF investors are not traditional precious metals investors, but rather shorter-term, momentum-driven traders seeking to capitalize on rising prices and hedge against stock market uncertainty. The ease of buying and selling ETFs compared to physical metal is a key factor.
• Futures & Options Market Decline: The futures and options markets have seen reduced participation due to increased compliance costs and regulatory oversight, making ETFs the preferred entry point for shorter-term investors.

III. Drivers of Price Increases: Beyond Silver-Specific Factors

Christian cautions against attributing the price surge solely to silver-specific factors. While acknowledging some silver-related momentum, he argues that broader economic and political uncertainties are the primary drivers.

• Commodity-Wide Rally: Gold, silver, platinum, palladium, copper, and aluminum all experienced significant price increases in 2025, indicating systemic factors at play.
• Economic & Political Uncertainty: Concerns about the global economy, political instability (particularly in the US), and social cohesion are fueling investment demand for safe-haven assets.
• Misinformation & Mania: Christian identifies a degree of “misplaced mania” among silver enthusiasts and momentum speculators, contributing to unsustainable price increases.

IV. 2026 Outlook & Key Risks

CPM Group anticipates that the exogenous risks and uncertainties that drove prices higher in 2025 will persist into 2026, potentially worsening.

• Continued High Prices: Expectation of continued high or plateauing prices for gold, silver, platinum, and palladium for much of 2026, potentially extending into 2027.
• Potential for Decline: A reduction in perceived risks could lead to decreased investment demand and lower prices.
• Political Volatility: Recent trends within the Republican party suggest increased political volatility in the US, adding to overall uncertainty.
• Central Bank Demand: CPM Group projects central banks will purchase approximately 8 million ounces of gold in 2026, consistent with 2024 levels (contrasting with inflated figures often cited by others).
• Silver Demand in Solar Panels: Expects a potential reduction in silver demand from the solar panel industry beginning in 2026, due to technological advancements reducing silver per unit.

V. Silver Supply & Demand – CPM Group’s Perspective

CPM Group strongly disputes claims of a silver supply deficit, criticizing the Silver Institute’s methodology for inflating demand figures.

• Silver Institute Methodology: The Silver Institute adds investment demand to fabrication demand, creating an artificially tighter market picture.
• CPM Group’s Analysis: CPM Group consistently projects silver surpluses, and when the Silver Institute’s investment demand is removed, their reported deficits disappear.
• No Real Silver Deficit: Christian emphatically states there is no real silver supply deficit, dismissing claims of impending shortages as based on misinformation.

VI. CPM Group’s Activities & Future Initiatives

CPM Group experienced an exceptionally busy 2025, leading to the postponement of some initiatives.

• Continued Video Production: CPM Group will continue producing free videos twice weekly, focusing on education, debunking misinformation, and marketing their research expertise.
• Upcoming Events: Client open forum on January 21st, 2026. Yearbooks scheduled for release: Gold (March 24th), Silver (May 27th), PGMs (July 21st).
• Gold & Silver Renaissance Report: A special report and webinar (available on YouTube) commemorating 25 years since CPM Group predicted a long-term upward shift in investment demand for gold and silver.
• Focus on Market Efficiency: CPM Group aims to resume initiatives focused on improving efficiency and opportunities in precious metals investment markets.

Notable Quote:

“You don't have to be a capitalist to be a greedy thief.” – Jeffrey Christian, referring to the misappropriation of Venezuelan central bank gold reserves.

Conclusion:

CPM Group anticipates continued volatility and uncertainty in the precious metals markets in 2026, driven by economic, political, and social factors. While acknowledging the potential for price declines, they maintain a generally bullish outlook, emphasizing the importance of accurate data and informed analysis to navigate the market effectively. They strongly caution against relying on misinformation and hype, particularly regarding silver supply/demand dynamics. The firm is committed to providing unbiased research and education to investors.