February 5, 2026
The past two years have been exceptional for precious metals. Gold delivered its best performance in 14 years in 2024, rising 25.5% and setting 40 all-time highs. Silver gained 21% over the same period. But 2025 took both metals into unprecedented territory and we believe we're now approaching an inflection point.
The numbers speak for themselves:
Gold:
- 2024: +25.5% annual return, 40 all-time highs, best performance since 2010
- 2025: +60% gain, 50+ all-time highs, prices surpassing $4,000/oz
- January 2026: New all-time high of $5,595/oz
Silver:
- 2024: +21.5% annual return
- 2025: +145%, the best-performing commodity of the year
- Prices doubled from ~$30/oz to above $70/oz, now trading around $80/oz
This wasn't speculation, it was a rational response to genuine macro uncertainty.
Several converging factors created ideal conditions for precious metals:
Monetary Policy Pivot
The Federal Reserve's rate-cutting cycle began in September 2024 with a 50 basis point cut—the first reduction in four years. Two additional 25bp cuts followed in November and December, bringing the fed funds rate from 5.25-5.50% to 4.25-4.50% by year-end. Rates have since fallen to 3.5-3.75%, with markets expecting further easing.
Lower interest rates reduce the opportunity cost of holding non-yielding assets like gold and silver, making them more attractive relative to bonds.
The reintroduction of tariffs in early 2025 sent shockwaves through markets. The "reciprocal tariff" announcement triggered the second-largest daily point loss in S&P 500 history (4.88%) and the largest point loss in Nasdaq history (5.97%). The average effective tariff rate rose to 10.1%, the highest since 1946.
This uncertainty drove capital into traditional safe havens.
Central banks globally purchased over 1,000 tonnes of gold in both 2023 and 2024—the highest levels in decades. This institutional demand provided a structural floor under prices.
Beyond monetary demand, silver benefited from surging industrial applications. Solar panel demand for silver paste jumped 25% in 2024. Electric vehicles use 25-50 grams of silver per vehicle, compared to 15-28 grams for conventional cars—and future solid-state batteries could require a kilogram or more.
Markets don't move in straight lines. After a 95% gain from early 2024 to current levels, we're seeing classic blow-off-top dynamics in precious metals:
- Parabolic price action
- Retail FOMO (gold ETFs saw $77 billion in inflows in 2025 alone)
- Extreme bullish sentiment
- Diminishing macro catalysts
More importantly, the conditions that drove the rally are stabilising:
Inflation is cooling. US CPI stands at 2.7% as of December 2025, down from 3.0% in September. Core inflation has fallen to 2.6%, the lowest quarterly average since June 2024. Economists expect inflation to remain in the 2.2-2.7% range through 2026.
Rate cuts are priced in. The market has already absorbed the Fed's easing cycle. Further cuts are expected but won't provide the same tailwind as the initial pivot.
Tariff uncertainty has normalised. While tariffs remain in place, markets have adjusted. Volatility has subsided from the initial shock.
When the fear trade runs its course, capital rotates.
Historically, after safe-haven rallies exhaust themselves, we see rotations into other asset classes. Here's our view on what comes next:
Copper stands out as the clearest beneficiary of the next cycle. JP Morgan forecasts prices reaching $12,500/mt by Q2 2026, a significant premium to current levels.
The thesis is structural:
- AI and data centres are driving unprecedented demand, 475,000 tonnes projected for data centre installations in 2026 alone
- Electrification tailwinds from EVs, grid infrastructure, and renewable energy
- Supply constraints from declining ore grades and slow permitting of new mines
- Fifth consecutive year of global supply deficit, with cumulative shortfalls since 2021 nearing 820 million ounces
Goldman Sachs and others see copper entering a genuine supercycle reminiscent of 2004-2008.
We should note that our positive outlook on oil is against consensus. The EIA forecasts Brent at $56/bbl for 2026, and JP Morgan expects $58/bbl. The market anticipates supply surplus as OPEC+ increases production while demand growth remains modest.
If you're considering oil exposure, do so with the understanding that you're taking a contrarian position.
As macro uncertainty subsides and inflation remains contained, we expect capital to rotate into higher-risk, higher-reward assets.
For crypto specifically, Grayscale's 2026 outlook predicts "the dawn of the institutional era", a shift from retail-driven volatility to more stable, institutional-driven growth. Key catalysts include:
- Bipartisan crypto market structure legislation expected to pass in 2026
- Deeper integration between public blockchains and traditional finance
- Continued ETF inflows and institutional adoption
Bitcoin predictions for 2026 range widely, from $70,000 (bear case) to $225,000 (bull case)—but the structural trend toward institutional adoption is clear.
Equity markets, meanwhile, benefit from the same dynamics: declining rates, stabilising inflation, and resilient corporate earnings.
We're not calling for an immediate collapse in precious metals. Gold could continue higher in the short term, momentum is powerful. Our view is that the risk/reward has shifted.
Key risks to monitor:
- Geopolitical escalation that reignites safe-haven demand
- Inflation resurgence from tariffs or supply shocks
- Fed policy reversal if economic data deteriorates
- Crypto regulatory setbacks that delay institutional adoption
Based on our analysis:
- Reduce precious metals exposure,particularly silver,on strength
- Build positions in copper and copper-related equities
- Maintain strategic allocation to risk-on assets (quality equities, Bitcoin/Ethereum)
- Stay nimble,2026 will be volatile as markets digest policy uncertainty
The great rotation is beginning. Position accordingly.
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*This commentary represents the views of Aweh Ventures and should not be construed as investment advice. Past performance is not indicative of future results. All investments carry risk.*
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