Originally published on cnbc
Gold’s Wild Ride and the 2026 Outlook
Gold’s explosive rally in 2025—from $2,650 in January to over $4,380 at its peak—has made it one of the year’s defining financial stories. On CNBC Prime’s The Big C, CPM Group Managing Partner Jeffrey Christian said volatility is “far from over.” He expects gold to continue rising in 2026, though with sharp swings. After moves of $400 up one week and down the next, Christian cautioned investors to prepare for both rapid gains and sudden pullbacks.
Government Shutdown and Economic Risk
Christian warned that the ongoing U.S. government shutdown is “extremely problematic” for growth. Each week of closure, he said, cuts 0.1–0.2% off GDP while weakening global confidence in U.S. fiscal stability. Combined with falling investment and housing data, the shutdown heightens recession risk and boosts safe-haven demand for gold and silver.
Rate Cuts and Gold’s Next Leg Higher
With the Federal Reserve beginning a rate-cut cycle, investors expect continued monetary easing to support metals. Christian believes deteriorating economic and political conditions—both in the U.S. and abroad—will sustain investor demand for gold and silver through at least the first half of 2026. CPM Group projects gold could average near $5,000 per ounce next year, with intraday prices likely to climb higher at times.
Central Banks, ETFs, and Investor Behavior
While headlines often exaggerate central-bank buying, Christian clarified that global purchases are running near 6 million ounces in 2025, down from about 8 million last year. Physical demand has softened as prices surged, replaced by fast-moving futures and ETF trades. “These are momentum investors, not long-term holders,” he explained, noting that speculative flows drove the steep October rise and correction.
Silver’s Dual Identity: Investment and Industry
Silver remains strong—trading near $48 per ounce—but its industrial side is cooling. Christian said solar-panel demand has flattened after two years of over-production, leaving the current rally driven mostly by investors. Refiners are processing old silver products sold into the rally, a temporary increase in supply that could weigh on prices. Still, CPM Group expects silver to average above $50 per ounce in 2026, with volatility mirroring gold’s trajectory.
A Balanced View on Base Metals
Despite the spotlight on precious metals, Christian noted that copper, aluminum, and other base metals have also risen sharply. Investors are “short-term bullish but long-term cautious,” he said, as both safe-haven and growth assets advance simultaneously. This mixed signal underscores how global markets remain uncertain about the true strength of the economy.
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