2026-01-20 11:41:49
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In recent weeks, global financial markets have once again entered a phase of heightened uncertainty. U.S. President Donald Trump’s policy actions surrounding Greenland have sharply strained relations between the United States and Europe. Simultaneously, multiple geopolitical flashpoints are intensifying, driving risk aversion significantly higher. Against this backdrop, precious metals have surged to new record highs. This report analyzes the drivers behind rising gold and silver prices from three key dimensions: geopolitics, global trade, and resource supply dynamics, offering structured insights for investors.
Deterioration in U.S.–Europe Relations Over Greenland and the Direct Market Impact of Tariff Policies
On January 17, the Trump administration announced a 10% import tariff on eight European countries—Denmark, Norway, Sweden, France, Germany, the United Kingdom, the Netherlands, and Finland—with the rate expected to rise to 25% by June. The measure stems from these nations’ opposition to U.S. efforts to assert control over Greenland. European leaders swiftly responded, warning that the move would “undermine transatlantic relations and create a dangerous downward spiral,” signaling a significant setback in U.S.–Europe ties.
Following the tariff announcement, European automotive and luxury goods sectors came under immediate pressure. Global risk assets broadly retreated, while safe?haven flows accelerated into precious metals. Gold prices surged to approximately USD 4,676 per ounce, and silver breached USD 94 per ounce—both reaching new historical highs. The pronounced rise in safe?haven demand reflects market concerns over an escalating transatlantic trade conflict.
Multiple Geopolitical Fronts Intensify, Amplifying Global Uncertainty
Beyond the Greenland dispute, the United States has strengthened its policy actions in Venezuela and Iran, further elevating geopolitical risks. The U.S. has detained the Venezuelan president and taken control of key oil assets, while also expressing a willingness to consider military measures against Iran. At the same time, the Trump administration continues applying pressure related to Greenland, contributing to a broad expansion of geopolitical tensions.
Meanwhile, the European Union is preparing countermeasures of its own. U.S. tariff actions could trigger up to EUR 93 billion in retaliatory tariffs from the EU, deepening concerns about a prolonged and widespread trade confrontation. The accumulation of risk events has significantly reduced global risk appetite, leading investors to increase positions in gold and silver, which in turn has driven precious metal prices higher.
Sino?U.S. Resource Competition Tightens Silver Supply, Fueling Outperformance Over Gold
Silver’s recent strong performance stems not only from heightened risk aversion but also from structural tightening on the supply side. In response to the U.S. “Liberation Day” tariffs imposed last year, China has gradually restricted exports of rare earth elements and certain key metals, including silver. As silver is a critical input for AI hardware, renewable energy components, electric vehicles, and high?value industrial applications, these export controls have tightened global supply conditions. In some markets—such as Shanghai—physical silver has even traded at a premium of USD 10.
Against the backdrop of robust industrial demand, restricted exports, and declining inventories, major international investment institutions believe that silver has a rising probability of breaking above USD 100 per ounce. Gold also has the macroeconomic foundation to move toward USD 5,000 per ounce. The combination of supply constraints and elevated geopolitical risks has positioned silver as the leading performer in the current precious?metals rally, with its relative strength increasingly evident.
Inflation Expectations, Risk Aversion, and Capital Flows Continue to Drive Upward Momentum in Gold and Silver
As trade tensions intensify, markets widely expect rising corporate costs to feed into higher inflation. Precious metals, long regarded as traditional hedges against inflation, have therefore attracted increased portfolio allocation. In addition, escalating U.S.–Europe tensions, Sino?U.S. supply?chain frictions, and political uncertainty—including investigations involving the Federal Reserve Chair—have further amplified instability, pushing investors toward gold and silver as political?risk hedges.
Furthermore, global central banks have continued to accumulate gold as part of their foreign exchange reserves, while precious?metal ETFs have recorded significant inflows. This strong capital support has reinforced the sustained upward trend in both gold and silver.
Geopolitical Forces Become the Dominant Driver, Precious Metals Retain Upside Potential
Overall, frictions between the United States and Europe over Greenland have heightened tariff risks and pushed relations toward confrontation. At the same time, U.S. actions in Venezuela and Iran have further intensified global geopolitical uncertainty, while Sino?U.S. competition over strategic metals has created structural shortages in the silver market.
With these high?risk factors overlapping, global risk aversion remains elevated, supporting precious?metal prices at historically high levels. Gold stabilizing in the USD 4,600–4,700 per ounce range has increasingly become the norm, while the probability of silver challenging USD 100 per ounce continues to rise. Should geopolitical tensions further deteriorate, both gold and silver could see additional upside, making the precious?metals sector a key area for investor attention.
Upway Global: Driving New Patterns in Gold Investment
Upway Global, a prominent brand under Upway Group, has been rooted in the market for over 15 years, holding Grade AA member status (No. 084) at the HKGX? and serving as a core member of Bullion Group. As a key player in the precious metals investment sector, Upway Global strictly follows international purity and quality standards, earning the prestigious “Recognised Delivery Bar Refiner Certificate,” ranking among Hong Kong’s top refiners. The brand focuses on offering diverse electronic trading in precious metals, its outstanding market performance includes a single-day XAU? turnover reaching USD 80.75 billion in 2025, with over 2.13 million active members and over 700 million cumulative orders, maintaining the highest average monthly trading volume at the HKGX?.
At the same time, Upway Global recognises that user experience is central to brand competitiveness. Our platform offers 24/7 multilingual customer support, with dedicated service specialists assisting clients around the clock. Standing side by side with investors in a rapidly changing market, Upway Global helps clients achieve steady asset growth through reliable and professional services.
Risk Disclosure
This report is based on publicly available information and mainstream media coverage. Policies and data may change upon release of official documents or judicial rulings. Precious metal prices are affected by USD dynamics, interest rates, geopolitics, and central?bank demand, among other factors, and are subject to significant volatility. Any investment views herein are for reference only and do not constitute investment or trading advice for any individual. Please assess decisions prudently in light of your own risk tolerance and financial conditions.
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