2026 begins under heavy political strain
The year 2026 opened with significant political upheaval. President Donald Trump threatened decisive action against Iran. The warning followed the capture of Venezuela’s leader by US forces. His administration launched a criminal investigation into the Federal Reserve chair. Officials also targeted core profits of banks and major investors. These developments created uncertainty across global markets.
Stocks show surprising resilience
Many expected equities to plunge. That reaction never occurred. Traders largely ignored the political turmoil. US stock indexes hit record highs early in the week. Prices then eased only slightly. Despite rising tensions, equity markets remained steady.
Metals market becomes a refuge for investors
Investor anxiety shifted to metals. Silver jumped over six percent on Wednesday. Prices climbed past 90 dollars an ounce. Silver now shows a 29 percent gain in 2026. That follows a 141 percent surge in 2025—the best year since 1979.
Gold also climbed. Prices rose nearly one percent on Wednesday. Gold traded above 4,600 dollars per troy ounce. The metal gained 22 percent so far this year. In 2025, gold jumped 65 percent, marking its strongest year since 1979.
Industrial metals also rallied. Tin, copper, aluminum, lithium, and zinc all posted gains in 2026.
Safe-haven buying drives demand
Gold remains a preferred refuge during instability. Investors use it to hedge inflation and deficits. Geopolitical tension reinforces its appeal. Economic uncertainty pushes investors toward physical assets, boosting metals prices further.
Metal prices spiked after US strikes in Venezuela. They surged again after Trump threatened Iran. Widespread protests and crackdowns added to market anxiety.
Federal Reserve turmoil fuels further gains
Metals gained momentum after central bank news. Federal Reserve Chair Jerome Powell revealed a criminal investigation against him. The announcement raised fears of political interference. Investors questioned the Fed’s independence. Short-term rate cuts could support stocks briefly. Long-term risks include lost credibility and renewed inflation.
These concerns revived the “Sell America” trade. US Treasuries and the dollar fell. Worries about rising deficits strengthened the case for metals. As capital exited those markets, gold and silver became more attractive.
Strong demand underpins the rally
Fundamentals added to metals’ rise. China found new export markets despite rising tariffs. Its trade surplus hit record highs. That increased demand for metals used in electronics and technology.
Artificial intelligence growth added pressure. Expanding data centers required more metals. Technology infrastructure growth continues to drive industrial demand.
Rising prices risk consumer hardship
Higher metals costs could hit American households. These materials appear in many consumer goods. Oil prices remain low but have begun rising alongside commodities. That trend threatens to intensify cost-of-living pressures.
“Bottom line, we see serious industrial metal inflation,” analyst Peter Boockvar wrote. He warned the next Federal Reserve chair will face a major policy dilemma.
