Author: Evie Soemardi

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Tracking the Shift: Precious Metals vs Tech, Crypto and Equities

Markets have entered a decisive phase as investors reassess where capital is safest, and where it can still grow. Two months of heightened volatility have sharpened the contrast between risk-on and risk-off assets revealing clear winners as global uncertainty persists.  Last week we examined the theme of asset class rotation and how capital moves between risk-on and risk-off sectors as conditions evolve. Building on that discussion, today we compare how gold and silver are performing against major indexes and cryptocurrencies since early September and year to date. At the time of writing, gold trades at AUD $6,416 per ounce, and you can buy silver bars at AUD $79.89, and platinum at AUD $2,426. With these spot figures in mind, let’s explore how the rotation is playing out across markets.

 

Influencing Factors

One of the most interesting developments is gold’s resilience is the recent rebound in expectations for a rate cut. After the release of the U.S. Federal Reserve minutes from its November meeting, markets were reminded that rate policy is far from settled. While some Fed participants favour cuts if the economy progresses as expected, many others suggest holding rates steady for now. Chair Jerome Powell reinforced this when he stated that a December rate cut was not a “foregone conclusion.” However, since then there have been dovish comments from key officials.  Recently, New York Fed President John Williams signalled there was “room for further adjustment,” and Fed Governor Christopher Waller deeming a December 25-basis-point cut “appropriate” due to persistent labour market weakness, downplaying the resilient September jobs data as likely to be revised lower and emphasizing employment risks over sticky inflation. The CME FedWatch probability for a December cut has surged to 85.1% as of November 25, up sharply from 42.4% a week ago and well above the post-minutes low of 33.6%. That renewed consensus and optimism means that gold’s earlier decline (triggered by an overbought market) is being reversed as the market refocuses on fundamental drivers, such as lower-for-longer rates supporting safe-haven demand, rather than immediate policy uncertainty.

That shift in sentiment is playing out across the asset spectrum. Lower rates typically move demand towards non-yielding assets like gold and silver. At the same time, the expectation of a rate cut means less new liquidity for risk-on sectors such as equities and cryptocurrencies. Because of this, capital is tending to favour safe havens assets.

 

What This Means in Practice

When interest rates are cut, the opportunity cost of holding gold and silver falls which makes them more attractive. Currently, with the probability of a cut reduced, precious metals are holding their ground rather well. Simultaneously, with fewer rate cuts expected, less new money is flowing into equities and crypto. This dynamic is visible in the performance numbers as at last Friday: the Nasdaq Composite started September at 23,951 and now sits at 22,078, down 7.82 %. The ASX 200 began the month at 8,865 and is now 8,432, down 4.88%. Meanwhile, Bitcoin fell from AUD $165,865 to AUD $134,003, a colossal 19.2 % drop. In contrast, gold climbed from AUD $5,306 to AUD $6,315 (+19%), and silver from AUD $59.76 to AUD $78.55 (+31%).

 

Performance Year to Date

When we look at the full year, the contrast is even sharper. The Nasdaq began the year at 19,309, representing a 14.34 % gain to date. The ASX 200 opened at 8,215, up 2.64 %. Bitcoin began 2025 at AUD $147,610, incurring a loss of 9.22 %. By comparison, gold moved from AUD $4,241 to AUD $6,315, a 48.9 % increase. And silver posted an even stronger result, climbing from AUD $46.68 to AUD $78.55, a 68.27 % rise.

 

In summary

In a world of fluctuating confidence and shifting capital, the differences between asset classes have never been clearer. Equities and cryptocurrencies remain exposed to growth expectations and liquidity cycles, while gold and silver continue to demonstrate their worth during times of uncertainty. For investors focused on both wealth preservation and strategic growth, precious metals remain the go-to asset class. While no asset rises in a straight line, the relative strength of gold and silver suggests that their secular bull markets are still in the early innings, and that now may be a smart time to strengthen your position.

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Gold’s 5,000-Year Record: Lessons from History and the Road Ahead

For more than five millennia, gold has held its place as the ultimate store of wealth, a universal standard that transcends currencies, governments, and even civilisations. Its longevity is what makes it unique. Gold’s history provides the rare ability to analyse long-term trends and cycles that stretch across generations. The same cannot be said for newer markets (such as cryptocurrencies and specific equities), which have yet to prove themselves through repeated cycles of crisis and recovery. Today, gold continues to perform its ancient role with renewed relevance. At the time of writing, gold trades at AUD $6,242, silver at AUD $77.57, and platinum at AUD $2,387. Each metal has seen strong gains since early September and recent corrections appear to be part of a broader upward trajectory, the hallmark of a healthy, long-term bull market. Understanding gold’s long-term patterns allows one to place current price movements in their proper historical context and make better-informed investment decisions.

 

Historical secular bull markets in gold

A secular market describes a long-term trend driven by structural economic and geopolitical forces, often lasting years or decades. A secular bull market can include short-term pullbacks, yet the underlying trend remains upward. These corrections are essential for sustaining long-term growth by cooling off overbought conditions and setting the stage for renewed advances. The recent two-week correction in both gold and silver serves this purpose precisely, providing the market with the necessary pause before the next leg higher.

To appreciate the current moment it helps to look back. During the secular bull market of the 1970s, gold rose an astonishing 2,400% over nine and a half years, fueled by inflation, oil shocks, and the collapse of the Bretton Woods monetary system. The next secular bull market began in 2000 with the Dot Com bubble and consequent crash reaching record highs after the Global Financial Crisis, as gold gained 630% over ten years. By comparison, the current bull market, which began in late 2022, is up just 147%, still early in its cycle by historical standards. If history is any guide, this suggests there is considerable room for growth ahead.

Bear market or correction?

We have fielded the same question from many clients regarding the most recent pullback: are we witnessing a new bear market, or simply another correction within a broader bull run? The evidence strongly supports the latter. Gold’s recent 12% pullback (from its all-time high of AUD $6,758 to AUD $5,953 at the end of October) aligns closely with past corrections seen during earlier bull cycles. Even if gold had hypothetically fallen as low as AUD $5,676, representing a 16% decline, it would have still been consistent with historical norms. In each of gold’s previous secular bull markets, such retracements were followed by strong recoveries and new highs.

The below table shows multiple pullbacks in the U.S. gold market during the 2001 bull run.

Gold is now in the midst of its third major secular bull run since 1971, the year the U.S. abandoned the gold standard. Like the cycles of the 1970s and 2000s, this one is being shaped by a potent combination of government debt, inflation, geopolitical tension, and a weakening U.S. dollar. Gold has already broken decisively out of its short-term downtrend, confirming that the broader bull market remains intact — and, most importantly, that it still has many years left to run.

 

Gold versus the NASDAQ: shifting capital between asset classes

Markets move in cycles, and investors constantly rotate between asset classes in search of value. The relationship between gold and equities (particularly the NASDAQ, or technology stocks) illustrates this clearly. Generally investors shift between asset classes in response to the market and associated factors according to their risk tolerance.  For instance, when technology stocks surge, gold often lags, and when confidence in risk-on assets fades, gold typically leads. This inverse relationship has played out repeatedly over the past two decades.

After the dotcom crash in 2000, the NASDAQ lost nearly 80% of its value, while gold began a multi-year rally as investors sought safety in hard assets. From 2016 to 2024, both gold and the NASDAQ rose together — the former driven by inflation, central bank buying, and geopolitical tension; the latter by technological breakthroughs in cloud computing and artificial intelligence. Yet such dual rallies rarely last indefinitely; however, tech valuations have left gold behind and once again stretched to extreme levels. For equities in general, the Buffett Indicator (the ratio of total U.S. stock market capitalisation to GDP) is now sitting around 213%, far above the historical norm of 75%–90%. For comparison, the indicator peaked at just 140% during the 2000 dotcom bubble and 202% in 2021 after the COVID stimulus surge. The U.S. stock market is now more overvalued than at any time in the last 45 years.

Gold and the NASDAQ belong to very different classes. Gold is recognised by the International Monetary Fund as a risk-free asset for central banks, while equities, particularly technology stocks, are inherently risk-on. When capital shifts from one to the other, it often marks the turning point of a cycle. If history is any guide, we may now be entering a period where investors rotate out of overvalued equities and back into gold, a pattern that has accompanied every major correction since the 1970s.

Conclusion: Positioning for the Next Phase

History rewards investors who understand where they are positioned within a market cycle. The most successful are those who exit overvalued assets near their peak and enter undervalued ones near their base. Today, equities and particularly U.S. technology stocks show signs of being at the top, while gold is still early in what appears to be a long secular bull run.

The underlying forces driving this trend, record debt, political instability, persistent inflation, and global uncertainty, are not temporary. They are structural. Gold’s 5,000-year record as a store of wealth continues to reaffirm its role as the foundation of financial security when other markets reach speculative extremes. For investors, the message is clear: focus on value, not noise. Short-term corrections are simply pauses within a much larger movement. In a world that continues to test economic resilience and political credibility, gold remains what it has always been, the ultimate hedge, the ultimate constant, and the ultimate measure of lasting wealth.

We make it a simple process for our valued clients to buy gold online. Click here to see availability and the most up to date prices.

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Silver’s Rhythm: Lessons From the Past, Signals for the Future

After one of the strongest runs in recent memory, silver has entered a period of consolidation. The recent pullback, while sharp, is characteristic of the metal’s historical behaviour during broader upward momentum. In markets driven by media hype and increased awareness, silver is the first to sprint — and the first to stumble — yet its long-term trajectory remains upward. As of today, gold trades at AUD $6,155, silver at AUD $74.57, and platinum at AUD $2,385.

Periods like this provide perspective. When volatility replaces steady gains, looking back becomes the most valuable tool when looking forward. History does not repeat exactly, but in the case of silver, it rhymes loudly. The story of silver’s great bull markets offers important clues about where it might be heading next. Find out how silver’s next big move to the upside is reinforced by silver’s past performance.

 

Historical Silver Bull Runs and Corrections

The first time silver made headlines for its parabolic rise was in the early 1980s, when the Hunt brothers and their Arab partners attempted to corner the market. The result was one of the most dramatic bull runs in commodity history. Between January 1979 and February 1980, silver climbed from USD $6.02 to USD $35.52, an extraordinary 490% gain (on $6.02) in just thirteen months. Its ascent was matched only by the speed of its fall. Within sixteen months, it had plunged to USD $5.73, erasing 83% (of $35.52) of its value.

Three decades later, history repeated with a modern twist. In the aftermath of the Global Financial Crisis (GFC), silver surged again, rising from USD $9.28 in late 2008 to USD $48.70 by mid-2011, a 425% increase. And, as in 1980, the correction that followed was brutal. By the end of 2015 silver had fallen to USD $13.80, surrendering 71% from its peak price.

The lesson is simple: silver likes to party. It runs hard and crashes hard within compact timelines. It offers greater upside than gold during bull markets and greater risk for those who overstay the celebration. Timing is everything.

How History Informs the Future 

Before drawing conclusions one crucial distinction must be made between silver’s past and its present. The 1980 rally was a manipulation story, the product of two individuals, Nelson and William Hunt, exploiting a thinner, slower and more ignorant market. Their attempt to monopolise supply succeeded briefly but collapsed under regulatory pressure and margin calls.

By contrast, the 2011 bull run was driven by market fundamentals. The internet age had democratised access to information, global participation had expanded, and silver’s value was tied to legitimate financial fear in the wake of the GFC. The market was no longer a playground for a few wealthy speculators — it was driven by core economic forces, liquidity, and sentiment.

Fast forward to today. The modern silver market is too large and interconnected for individual manipulation. It takes coordination among several major institutions to shift it materially. Even then, fundamentals remain the decisive force and they are flashing bright. Unlike in 2011, the global system is now far more fragile, with governments and central banks constrained by unsustainable debt levels, inflationary pressure, and slowing productivity. Political will to enact meaningful reform is scarce, options are narrow and time is limited.

Cracks are visible across the landscape: sovereign and private debt are ballooning, inflation remains stubborn, equity and real estate valuations are stretched, and confidence in technology-driven solutions such as AI is doing little to effectively address deeper structural problems. These vulnerabilities span both East and West. The global financial system is now so deeply interconnected that any correction in one major economy reverberates quickly, and often amplifies, around the world.

 

The current silver status quo

Since early September silver has risen 26%, even with the latest correction. Measured from January 2024, its price has more than doubled from AUD $34.30 to AUD $74.54, a 116% increase.  Importantly it has achieved this without a major global downturn. That alone is telling. Historically, silver rallies have been reactive — responses to crises. This time, gold and silver is leading. It is rallying ahead of the correction, not because of it.

When real estate and equities (and by association some cryptocurrencies) sit at cycle highs, capital usually flows away from safe havens. Yet today, funds are quietly returning to gold and silver. This suggests investor confidence is eroding beneath the surface even as the major indices continue to climb. In short, silver’s surge is an early signal that risk tolerance is fraying and markets are stretched to breaking point.

In Summary 

When fundamentals finally give way, the global financial system may face a shake-down of historic proportions. Technically, silver has just completed a 45-year cup-and-handle formation thus setting the stage for what could be an explosive move to the upside. If history is any guide, the next bull phase will be both swift and steep, followed inevitably by an equally fierce correction.

For investors, this phase demands vigilance and preparation. The recent pullback should not be read as a warning, but as an opportunity. It represents a healthy pause within a much larger uptrend, a moment to consolidate, accumulate, or re-enter strategically. Whether through disciplined dollar-cost averaging or careful accumulation, the window remains open for those who recognise the pattern.

Silver’s rhythm has always been cyclical: euphoric surges followed by sobering retreats. But each cycle ends higher than the last. Protection requires preparation, and today’s consolidation provides precisely that: a chance to position ahead of what could be silver’s most significant run in half a century.

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Healthy Pause: Gold and Silver Pull Back After Historic Run

After one of the strongest rallies since 1979, gold and silver are experiencing a brief but orderly correction. The pullback has taken both metals back to levels seen three weeks ago, yet prices remain well above their early September starting points. Gold is currently trading at AUD $6,107.60 per ounce, silver at AUD $74.80, and platinum at AUD $2,362.86. Even after the retracement, gold is still up over 16% since the beginning of September, an impressive gain that underscores the metal’s resilience. Technical indicators suggest that the short-term correction may be nearing its end, setting the stage for renewed strength in the months ahead.

 

Fundamentals remain unchanged

The key drivers supporting growth in precious metals have not changed. Geopolitically global tensions remain high. In the Middle East, conflict persists between Israel and Hamas despite President Trump’s public claim that the war is over. Russia continues its Special Military Operation in Ukraine, while trade friction between the United States and China persists under the Trump Administration’s tariff policies — tensions that are increasingly being framed as a matter of national security, particularly around critical minerals, a category that now includes silver.  The world remains as fragile (and as uncertain) as ever.

From a fiscal perspective, America’s financial position continues to deteriorate. Economic growth has slowed to 2.1%, down 1% from this time last year, while the national debt has climbed beyond USD $38 trillion. Questions around Federal Reserve leadership add further uncertainty. With Chair Jerome Powell expected to be replaced in May of 2026, speculation about his successor has intensified, and the process (led by Treasury Secretary Scott Bessent, a noted gold advocate) is already sparking debate over the Fed’s independence. Political theatre around the appointment process is likely to inject additional volatility into financial markets over the coming year.

In currency markets, the AUD/USD exchange rate continues to trace a long-term flag formation, a pattern often followed by a decisive breakout once it nears completion. We maintain the view that this breakout is more likely to occur to the downside, which would support higher local pricing for gold and silver when it eventually unfolds. Read more about our AUD outlook and its implications for gold bullion pricing here.

 

The Federal Reserve pauses gold and silver’s comeback

This week’s Federal Reserve meeting confirmed market expectations with a 0.25% rate cut, bringing the primary credit rate down to 4%. Members voted unanimously despite limited economic data due to delayed releases of jobs, inflation, and housing reports.  This is the first time the Fed has made decisions without a full suite of data since its inception in the 1930s.  Prior to the announcement gold began recovering from its short-term pullback, gaining nearly AUD $100 in local markets; however, following the Fed’s decision, investor sentiment shifted toward risk-on assets such as equities, trimming some of those early gains. Silver followed a similar pattern though its response was more muted. As markets digest the policy shift, attention now turns to whether gold can reassert its upward momentum once the initial volatility subsides.

 

Short-term pullbacks within long-term bull markets

Historically, gold bull markets rarely move in a straight line. Sharp rallies are often followed by short periods of consolidation, a natural reset that allows the market to stabilise before advancing further. A similar pattern emerged this time last year when gold moved sideways for two weeks before resuming its climb. The current retracement fits neatly within this broader pattern and can be viewed as a healthy pause rather than a reversal.  Bull markets thrive on momentum, and corrections like this one typically strengthen the next phase of the rally. Technical charts suggest that both gold and silver are near the end of this corrective cycle, with momentum indicators beginning to stabilise. Given the enduring strength of global fundamental positions the longer-term trajectory for both metals remains firmly upward.

 

In summary

Gold is currently trading more than 11% below its all-time intraday high of AUD $6,764, providing an attractive entry point for investors seeking to accumulate at lower levels. Silver, too, remains well positioned for renewed upside once short-term selling pressure subsides. The fundamentals that have driven both metals higher — geopolitical tension, fiscal weakness, and currency instability — are unchanged. In this context, the current correction presents not a reason for concern, but an opportunity. For investors focused on long-term wealth preservation, the window to accrue while prices are temporarily depressed may prove brief. In a world of ongoing uncertainty, gold and silver continue to stand as the most reliable forms of financial protection.

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The State of Silver: Demand and Delay

A week ago, gold surpassed the psychologically important milestone of USD $4,000 per ounce, reaching an intraday high of USD $4,218 yesterday. It currently trades at AUD $6,476. Platinum also achieved a new all-time intraday high of USD $1,686 last Thursday, now trading at AUD $2,604. Yet the real highlight lies with silver, which has climbed more than AUD $10 since the start of October — a remarkable gain of over 19%, rising from intraday prices of AUD $69.85 to AUD $83.14 in just fifteen days.  In America it surpassed all-time highs and broke USD $50 six days ago, continuing with strong upward momentum.

Such rapid movement underscores a shifting dynamic in global precious metal markets. Silver’s dual identity as both a precious and industrial metal positions it uniquely within this environment. While demand remains structurally strong, growing delays in the physical bullion are have emerged in the Australian market. Together, these elements define the current state of silver, one of rising appetite and mounting logistical pressure.

 

The global state of demand

Global silver markets are undergoing a multi-year transformation. In 2024, total silver demand fell by 3%, shaped by competing forces across the investment and industrial sectors. Silverware consumption recorded a modest 2% decline, while investment in cast bars and coins dropped by 22% — the lowest level in five years — led by a sharp 46% fall in the United States. According to the Silver Institute, this pullback in investor demand reflects profit-taking at higher prices, market saturation, and reaction to President Trump’s election.

In contrast, industrial demand rose 7% to reach 700 million ounces, accounting for 59% of total global consumption in 2025. Certain industrial segments have become clear leaders: photovoltaic demand for solar panels has quadrupled since 2015, with the Silver Institute forecasting a further 20% increase this year. Electronics has maintained steady growth of around 5–7% annually since 2021, while electric vehicles and the broader automotive sector continue to expand at approximately 10% per year. Jewellery fabrication also climbed 3%, largely driven by renewed demand in India.

Below is a graph of global silver coin and cast bar demand since 2015, a reflection more of retail investment as opposed to industrial consumption.  The fall in demand since 2022 can mainly be attributed to profit taking, tighter household budgets (or weaker retail sentiment), and preference shifting towards the “paper” silver market.

 

The global state of supply

The physical deficit in silver now totals nearly 800 million ounces since 2021. This gap shows little short-term relief to any supply concerns.  Global silver mine production has declined 7% since 2016.  Global mine production is expected to peak in 2026 before beginning to decline as several major projects reach end-of-life (mainly in Mexico).  In developed nations new mining projects typically require five to eight years to progress from discovery to production.  And with roughly 72% of silver sourced as a byproduct of other metals, supply cannot easily respond to rising demand. Recycling will offer limited relief, while refined output faces increasing costs and environmental constraints.

However, persistent global supply deficits remain a defining feature of the market stretching over the past four years, with 2025 expected to mark the fifth. The net result is a tightening market, where physical availability continues to contract even as industrial and investor interest builds. In 2025 demand clearly still exceeds supply — leaving the market in a sustained structural deficit. Yet history shows that each major silver deficit has ultimately set the stage for stronger prices, as physical inventories tighten and market confidence erodes.

 

Demand in Australia

Silver demand in Australia continues to accelerate as an extraordinary squeeze on silver plays out across the country. The Perth Mint is West Australia’s government owned refinery and the only establishment that publishes sales figures.  The refinery saw minted silver products total 578,588 troy ounces in September 2025 — a 36% increase from August and the highest monthly figure since April. It is estimated that the increase could be between 40-60% or even higher for bullion merchants in the private sector.

The Perth Mint’s total silver bullion sales (minted plus cast bars) reached 721,338 troy ounces in September — a 28% increase from August. This surge highlights the renewed strength of the local silver market and a growing concern about the state of the global financial landscape, fiat currency and confidence in our bureaucrats.

 

Supply in Australia

Access to physical silver has significantly tightened across Australian retail markets in October. This is not due to a lack of raw supply, but rather production bottlenecks in refining and bar manufacturing. With demand roughly double what it was at this time last year, refineries producing branded cast bars are facing increasing pressure. Lead times for delivery have doubled, and further delays are inevitable if the current pace of buying continues.  Now the cost of sourcing both gold and silver is creeping up for refineries as the run on metals deepens further into the supply chain; this will ultimately affect the retail price of both metals sooner rather than later.

While supply constraints are currently logistical rather than structural, they point to a growing imbalance between immediate demand and fabrication capacity — a pattern often seen in the early stages of sustained bull markets.

 

In summary

Silver investment in 2025 has been defined by a clash of forces: strong investor appetite and constrained supply on one side, and a changing global economy on the other. The metal’s unique dual role for both industrial use and as a safe-haven asset continues to shape its volatility. Trade tensions, equity market corrections, and ongoing geopolitical risks all add to its appeal as a portfolio diversifier.

Expected US interest rate cuts and elevated uncertainty should continue to support silver’s momentum through year-end. With the gold-to-silver ratio still historically high, many investors see further upside potential. However, as access to physical bullion begins to slow, the issue of delay becomes as relevant as demand.  Having a good relationship with your bullion dealer has never been more important.

For Australian investors, the message is clear: silver’s strength is being matched by growing lead times. Securing positions now, while supply remains available and delays are still manageable, could prove a prudent step in an increasingly constrained market.

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Government Shutdown Erodes Confidence: Precious Metals Rally in Response

Government shutdowns have long been a feature of the American political landscape, but each episode leaves a deeper mark on global confidence. For investors, they highlight the fragility of the fiscal system in the world’s largest economy and raise fresh questions about stability. The latest shutdown, beginning at 12:01 a.m. EDT on October 1 in the US, has already rattled markets. At the time of writing, gold is trading at AUD $5,853.16 per ounce, silver at AUD $71.72, and platinum at AUD $2,420. Precious metals are once again proving their worth as safe-haven assets while investors brace for further turbulence.

 

What triggers a government shutdown?

The immediate cause of the current shutdown is a familiar one: political gridlock. Congress failed to agree on either a comprehensive budget or a stopgap funding bill, with negotiations collapsing over fundamental disagreements on welfare structures, tax reforms, and federal spending priorities. As a result, non-essential federal agencies closed their doors at the start of October.  The House of Representatives passed a temporary measure, but Senate Democrats blocked its progress through a filibuster (where the minority refuses to end debate), preventing the bill from reaching the required 60-vote threshold. This latest standoff reflects an increasingly entrenched divide between parties, with little sign of compromise on either side.

 

The immediate fallout for America

The immediate effects of the shutdown are significant. Approximately 750,000 federal workers have been furloughed without pay (with backpay due upon return) and non-essential services are now suspended.  Analysts estimate the economic cost of the Government shutdown is approximately USD $400 million daily.

Unlike prior shutdowns, this impasse lands at a time when global markets are already on edge. Inflation remains above target of 2% at 2.9%, growth is faltering, and geopolitical risks are multiplying. The impending delay in publishing jobs or inflation data now clouds the outlook for the Federal Reserve ahead of its next meeting, complicating monetary policy decisions. Meanwhile, threats from the White House to cut federal jobs outright only add to the sense of instability.

 

Lessons from past episodes

Government shutdowns are not new however their severity has varied. The 2018–2019 shutdown under President Trump stretched to 35 days, the longest in history, while the 2013 episode under President Obama lasted 16 days. Most shutdowns since 1980 have been resolved within one to three weeks.  The current domestic political climate for the U.S. has experts suggesting a potentially prolonged stalemate due to political unwillingness to yield on core policy issues.  This is playing out in an already fragile economic backdrop. If it does, the economic and financial damage will likely intensify, spilling into the global economic framework as uncertainty.

 

Gold’s historical response

Gold has often shown resilience during shutdowns with investors moving to hedge against both political dysfunction and economic uncertainty. The difference this time lies in the broader environment: political turmoil only magnifies the instability around high inflation, slowing growth, and colossal fiscal debt, all of which are fundamentals that existed long before the current government shutdown was even contemplated. While past shutdowns have produced mixed results for precious metal prices, the current rally stands out for both its speed and its scale and is more in response to underlying economic fragility than that of the shutdown itself.

The symbolism is as important as the substance. Each shutdown reinforces doubts about America’s ability to manage its own finances, eroding the credibility of both the US government and the US dollar as anchors of global stability. In this environment, gold, silver, and platinum are once again proving themselves as stores of value.

 

Confidence Under Pressure

Shutdowns deliver more than just administrative disruption. They deliver a psychological blow to global markets by highlighting dysfunction at the heart of the world’s largest economy. The US dollar remains vulnerable if confidence in America’s political system deteriorates further.  This erosion of trust matters because the US still anchors international markets. Each round of brinkmanship (dangerous policy practice or political strategy) weakens that position. For international investors the signal is clear: political risk is no longer confined to emerging markets but continues to seep into the West’s sole superpower. It infects fiscal and financial systems with apprehension and uncertainty and spreads outward, carried through shifting capital flows – flows that lead to gold, silver and platinum.

The below graph illustrates that, while shutdowns are effective mechanisms of destabilisation and they contribute to a lack of confidence, it is not the primary cause of the current bull run in either gold or silver.

Conclusion

Even though gold, silver and platinum have increased considerably since the beginning of September, the political climate underscores the fragility of the financial system and adds yet another layer of uncertainty to an already volatile global environment. For investors, the message is simple. When trust in governments falter, and when political dysfunction threatens financial stability, gold and silver remain the ultimate safe havens.

As Australia navigates its own economic challenges, from currency weakness to reliance on external demand, precious metals offer a layer of protection that cannot be replicated by cash, bonds, or equities. In an era where shutdowns, deficits, and political gridlock are the new normal, the case for holding gold and silver has rarely been stronger.