Gold prices surged in early Asian trading on Friday, marking the first session of 2026, following a record-breaking finish to 2025. The uptick was driven by a softer U.S. dollar and renewed anticipation of lower interest rates, which revived investor appetite for the metal.
Spot gold climbed 1.6% to $4,378.55 per ounce by 00:18 ET (05:18 GMT), while U.S. gold futures advanced 1.2% to $4,392.40 per ounce.
After dipping from last year’s highs, gold drew fresh buying as markets reopened after the year-end holidays. The continued weakness of the U.S. dollar made bullion more affordable for investors using other currencies, offering immediate support for prices.
Impact of Rate Cuts in 2025
Gold had an exceptional 2025, jumping over 60%—its strongest annual performance in decades. This rally was largely fueled by the Federal Reserve’s multiple interest rate reductions and market expectations of further easing in 2026. Lower rates reduced the cost of holding non-yielding assets like gold, prompting investors to increase their bullion exposure.
Geopolitical uncertainty also played a role. Persistent tensions in Eastern Europe and the Middle East maintained demand for gold as a safe haven, while concerns over global economic stability further boosted its appeal. Central banks, particularly in emerging markets, continued aggressive purchases to diversify reserves away from the U.S. dollar. Analysts note that despite a minor pullback at year-end, the key factors supporting gold remain strong entering 2026.
Other Precious Metals Follow Suit
Silver and platinum also gained momentum. Silver rose 3% to $73.30 per ounce, benefiting from safe-haven demand and strong industrial use in renewable energy, electronics, and data centers. Platinum increased 2.5% to $2,102.30 per ounce.
In 2025, silver had soared nearly 150%, while platinum jumped 110%. Copper futures also edged higher, with London Metal Exchange contracts up 0.7% at $12,549.20 per ton and U.S. futures rising 0.6% to $5.74 per pound.
Frequently Asked Questions
Why did gold prices rise at the start of 2026?
Gold gained due to a weaker U.S. dollar and expectations of lower interest rates, which made bullion more attractive to investors.
How did gold perform in 2025?
Gold surged over 60% in 2025, marking its strongest annual gain in decades, driven by Federal Reserve rate cuts and geopolitical uncertainty.
What role did geopolitics play in gold’s rally?
Ongoing conflicts in Eastern Europe and the Middle East increased safe-haven demand, while global economic concerns also supported prices.
How did other precious metals perform?
Silver rose 3% to $73.30/oz and platinum gained 2.5% to $2,102.30/oz, following strong rallies in 2025 (silver +150%, platinum +110%).
Why are central banks buying gold?
Many central banks, especially in emerging markets, are buying gold to diversify reserves and reduce dependence on the U.S. dollar.
