Silver was the commodity darling of 2025 and the squeeze higher is continuing this year. Prices are up 5% today and above $80 for only the second time ever.
The first rise above $80 came on Boxing Day in low liquidity and quickly faded. This foray higher is coming in New York/European hours with desks fully staffed. That's a strong indication of underlying interest and continued backing from retail flows.
Notably, precious metals have a strong seasonal pattern in Dec/Jan, something I've been writing about for 15 years. With silver up 5% today, gold is also up 0.5% or $23 to $4471 after hitting as high as $4490. We are likely seeing some profit taking ahead of $4500.
The rally in precious metals this week has been helped by the seizure of Venezuelan President Nicolas Maduro by the Trump administration. That alone probably isn't responsible for the tailwinds but it was followed by administration officials talking about Colombia, Mexico, Cuba and Iran.
Greenland is also back on the agenda as the President talks about annexing the island despite it being part of NATO and Denmark.
Trump henchman Stephen Miller is out today with this line:
"We live in a world...that is governed by strength, that is governed by force, that is governed by power. These are the iron laws of the world since the beginning of time.”
The US dollar's foundation in the rule of law but with comments like this, you might want to hold something that's been valuable 'since the beginning of time' in the form of gold and silver.
I expect reserve managers to increasingly turn away from the US dollar and turn towards gold. Denmark holds a large portion of its FX reserves in US dollars and I would be wary of the US using those as leverage in a hostile negotiation (or fight) over Greenland.
