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Gold prices climbed sharply in European trading on Friday, the first session of 2026, as a softer U.S. dollar and expectations of further interest rate cuts reignited demand for bullion following a year of historic gains.
Spot gold rose 1.8% to $4,387.09 an ounce by 05:18 ET (10:18 GMT), while U.S. gold futures gained 1.4% to $4,399.90 an ounce.
Prices rebounded after easing from record highs in the final week of 2025, with renewed buying emerging as markets reopened following the year-end holiday period. A weaker dollar extended losses from late last year, making gold cheaper for holders of other currencies and providing fresh near-term support.
Fed easing drove 2025’s historic rally
Gold surged more than 60% in 2025 — its strongest annual performance in decades — propelled largely by a pivot toward looser U.S. monetary policy. The Federal Reserve delivered multiple rate cuts during the year, while markets also positioned for additional easing in 2026.
Lower borrowing costs reduced the opportunity cost of holding non-yielding assets such as gold, encouraging investors to increase exposure to bullion. Geopolitical tensions, including ongoing conflicts in Eastern Europe and the Middle East, further reinforced safe-haven demand, while lingering concerns over global growth and political stability added to gold’s appeal.
Central banks also continued to accumulate gold at a robust pace, particularly in emerging markets, as they sought to diversify reserves away from the U.S. dollar — another key pillar of support.
Although prices pulled back modestly from record levels toward the end of 2025, analysts said the core drivers of the rally remain intact as 2026 begins.
Silver and platinum advance after stellar year
Other precious metals moved higher in tandem. Silver jumped 4.9% to $74.47 an ounce, extending momentum after a powerful 2025 rally supported by both safe-haven demand and strong industrial usage tied to renewable energy, electronics, and data-center manufacturing.
Platinum climbed 5.3% to $2,139.50 an ounce. Last year, silver surged nearly 150%, while platinum gained around 110%, reflecting tight supply dynamics and renewed investment interest across the precious-metals complex.
U.S. copper futures also edged higher, rising 0.8% to $5.73 per pound.
