The precious and industrial metals markets have presented a truly extraordinary picture this year, with almost all items simultaneously trading near historical or multi-year highs.

Gold surged to $4,608 on Friday, closing the day with a 1.80% gain, while silver climbed to $68.99, a 1.15% increase. Two distinct forces are behind this movement: a weakening dollar makes metals cheaper for foreign buyers, while limited real bond yields reduce the opportunity cost of holding non-yielding assets like gold and silver. Concerns about slowing global growth and geopolitical friction also fuel safe-haven demand, indicating that investors are positioning metals more as a store of value than an income-generating vehicle.

Looking at the overall picture this year, the numbers are truly striking: throughout 2025, gold has gained 65%, silver 149%, platinum 122%, and palladium 72% – the largest annual increase for gold since 1979. In the first days of January 2026, gold surpassed $4,500, silver exceeded $80, and platinum reached its first record high since 2007. Institutions like TD Securities have revised their forecasts upwards for this year, predicting an annual average of $4,831 for gold, $65.50 for silver, $2,063 for platinum, and $1,819 for palladium.

On the industrial metals side, the real standout story is copper. In August, the metal hit a record high of $14,455 per ton on the London Metal Exchange, driven primarily by a surge in demand for AI data centers and electricity grid investments. Copper has historically been seen as an indicator of global economic activity, but analysts now emphasize that this relationship may have changed, with the price being more driven by demand for AI infrastructure. The disruptions at the Grasberg mine in Indonesia are another factor tightening supply, as this mine is one of the world's largest copper sources and its production is expected to recover only gradually until the end of 2027.

Aluminum is experiencing similar supply pressure, with China approaching its self-imposed 45 million ton annual production cap, limiting global supply. However, an 18.7% increase in Chinese exports is helping to offset some of the supply disruptions from the Middle East due to the Iran conflict. The Alunorte plant in Brazil, operating at half capacity due to natural gas supply problems, is another source of supply concern.

Nickel is performing more calmly compared to other metals. Indonesia's production accounts for approximately 60% of global mining output, leaving supply relatively comfortable. The World Bank expects nickel prices to rise by around 12% this year, a more moderate increase compared to other metals.

The common denominator bringing this picture together is that the conflict with Iran is driving up energy costs, mining disruptions, and potential new trade restrictions, indicating that the risks for metal prices remain skewed to the upside. The World Bank expects aluminum, copper, and tin to reach record annual levels in 2026, with increases of approximately 20% each.

For those following precious metal-linked tokenized assets like XAU and XAG through Gate, the key point to watch is that much of this rally is driven by dollar weakness and a geopolitical risk premium. The sustainability of these two factors depends on both the Fed's interest rate path and the course of the conflict in the Middle East. Details of the upcoming US sanctions package and Fed statements in the coming weeks will be the most critical developments in determining whether this metal rally continues.

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