Head of Commodity Strategy
Key points in this update:
After a phenomenal first half, the investment metals sector has entered a period of consolidation. Gold has traded sideways for the past twelve weeks, creating space for silver and platinum to play catch-up. Yet with year-to-date gains of roughly 26% for gold and silver—and a remarkable 54% for platinum—the natural question from investors is: Is that it?
We believe the answer is no.
The key drivers that have propelled metals higher in recent years remain intact, and additional tailwinds could emerge in the second half. Most notably, the prospect of lower U.S. interest rates could reignite demand, especially for metal-backed ETFs by reducing the opportunity cost of holding non-yielding assets like precious metals, compared to short-dated government bonds.
To understand gold’s enduring appeal—and by extension, that of silver and platinum—it’s important to recognise what sets these metals apart. Precious metals are politically neutral, unlike sovereign bonds or fiat currencies. They are universally recognised as a store of value, not tied to the creditworthiness of any nation, which is why central banks are increasingly allocating to gold as a core reserve asset.
This year’s broad dollar weakness has also supported strong returns in metals, though gains have varied depending on currency exposure. Investors in Switzerland and the eurozone, for example, have seen gold returns closer to 11%, while those in China and India—both dominant physical consumers—have experienced returns more in line with U.S. dollar-based investors. As the chart below indicates, gold is currently trading in a relatively tight horizontal range just below the April record high near $3,500. A lack of fresh bullish catalysts has raised the risk of a deeper correction, especially after recent signs of buyer fatigue. Gold notably failed to rally alongside silver and platinum or attract a safe-haven bid during the brief Israel-Iran conflict. At the same time, surprisingly strong U.S. economic data has postponed rate cut expectations without triggering a significant gold selloff—another sign of underlying resilience. Looking into H2, we remain constructive on gold and its peers. Key sources of support include: Technically, gold remains in consolidation mode, with immediate support at $3,245 and secondary support at $3,120. A break below the 200-day moving average—currently at $2,945—would challenge our bullish outlook. However, gold has remained above that level since October 2023, when it traded below $2,000. Until then, we view this consolidation as a pause—not the end—of the investment metals rally.
Silver’s recent breakout above USD 35 has reignited speculation that the semi-industrial metal may have further room to run in the months ahead. The move is underpinned by a structural supply deficit dating back to 2019, with annual demand consistently outpacing supply—eroding above-ground stockpiles and tightening the market.
The break above USD 35 - now key support that needs to hold - also helped silver recover ground lost to gold during the market volatility following Trump’s April “Liberation Day” tariff announcement. In relative terms, central bank gold buying since 2022 has left silver trailing leaving the gold-silver ratio elevated, trading near 90, well above its five-year average around 80. Should silver continue to close this gap, a move toward USD 40 over the next 6–12 months is not out of reach—particularly if mine supply struggles to keep pace with both industrial and investment demand.
Platinum, meanwhile, has emerged as the top-performing major commodity in 2025, with year-to-date gains of 54%, most of which have occurred since May. The rally was sparked by a technical breakout above USD 1,025, surpassing a long-term descending trendline stretching back to the 2008 peak near USD 2,300.
Once priced on par with gold, platinum has long been considered undervalued. The gold–platinum ratio, which hit a record high of 3.6-to-1 in April, has since narrowed to around 2.4-to-1, reflecting renewed investor interest.
Beyond the technical breakout and associated short-covering and momentum buying, fundamentals have also turned more supportive. The World Platinum Investment Council projects a third consecutive annual deficit, with demand expected to exceed supply by nearly one million troy ounces in 2025. As with silver, this imbalance is drawing down above-ground inventories.
Key demand drivers include a recovery in automotive demand—particularly in hybrid and diesel vehicles—as well as a notable uptick in Chinese jewellery and bar investment, encouraged by platinum’s relative price stability and discount to gold.
That said, investor appetite via platinum-backed ETFs remains subdued, with total holdings recently falling to a nine-month low—suggesting that while some are locking in profits, a broader speculative wave may still lie ahead should fundamentals tighten further. Having gained almost 40% in a matter of weeks since breaking the 17-year downtrend, platinum has for now found strong resistance around USD 1,427, the 50% retracement of the 2008 to 2020 drop. So far, support at USD 1,340, the 2021 high has prevented a deeper correction which at this point could extend all the way to USD 1,230 without damaging the overall bullish setup. Meanwhile a resumption of the rally through the recent highs may, from a technical perspective, bring the USD 1,630 level into focus.
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