Gold shines amid uncertainty

This blog post is part of a special series based on the April 2025 Commodity Markets Outlook, a flagship report published by the World Bank. This series features concise summaries of commodity-specific sections extracted from the report. Explore the full report here.

Precious metal prices surged to record highs in the first half of 2025, building on a 20-percent increase in 2024. The rally was led by gold, which approached all-time highs in mid-June amid escalating geopolitical tensions and elevated economic uncertainty. Silver and platinum also posted strong gains. Prices are expected to remain elevated through 2025 and 2026. Gold is on track to reach its highest annual average on record, supported by robust demand. Silver prices are expected to increase further, underpinned by resilient demand, while tight supply conditions will continue to support platinum prices. However, a further escalation in global tensions could lift gold prices above current projections, whereas weaker-than-expected industrial activity may dampen demand and drag silver and platinum prices below current forecasts.

Gold surged nearly 25 percent during the first half of 2025, building on a record-setting rally in 2024. Recent price increases have been driven by strong demand amid elevated policy uncertainty and intensifying geopolitical tensions. A sharp resurgence in gold exchange-traded funds (ETFs) inflows in the first quarter of 2025 pushed investment demand to its highest level since 2022. Central bank purchases continued to provide support, reflecting reserve-management strategies. Strong demand is expected to persist in the near term, underpinned by global uncertainty and geopolitical risks. Gold prices are projected to rise by about 35 percent in 2025 (y/y), before easing modestly in 2026 as some of the prevailing uncertainties begin to recede. Nonetheless, prices are projected to remain well above historical norms—around 150 percent higher than their 2015–19 average—through 2025–26. Risks to the outlook are tilted to the upside, with geopolitical developments expected to remain a major source of uncertainty.

Silver extended its strong 2024 momentum, rising nearly 20 percent in the first half of 2025 to reach record highs. Even with strong silver price gains, the gold-to-silver price ratio climbed further above its 10-year average in early 2025, continuing its steady upward trend. This partly reflects stronger relative demand for gold as a safe-haven asset amid heightened uncertainty and geopolitical tensions. Silver demand is expected to remain robust, supported by silver’s dual role as both a critical industrial input—used in sectors such as renewable energy and semiconductors—and a safe-haven asset. Heightened economic and geopolitical uncertainty could further bolster silver’s appeal among investors. On the supply side, global output is projected to rise steadily in 2025, driven by expanding mine production. Recycling, which accounts for about 20 percent of global supply, is expected to remain flat following a 6 percent increase in 2024. On balance, firm demand is expected to lift silver prices by 17 percent in 2025 (y/y), with a further 3 percent gain projected in 2026. 

Platinum prices surged nearly 30 percent during the first half of 2025, reaching their highest levels in over a decade. The rally has been largely driven by tightening supply, with mine production projected to decline and reach a five-year low this year. Modest gains in recycling are expected to only partly offset the shortfall, while aboveground stocks are set to decline sharply. Platinum demand, meanwhile, is expected to decline in the automotive and industrial sectors—particularly in chemicals and fiberglass—which together account for nearly two-thirds of global platinum use. Despite subdued demand overall, supply constraints are expected to support prices, with a 10 percent rise projected in 2025 (y/y) and a further 2 percent gain in 2026.