LBMA Precious Metals Market Report: Q1 2026

One Word: Unprecedented

It is commonplace to remark that dealers, traders, and indeed investors, regularly find themselves seduced by the allure of round numbers, and when such milestones are in sight, tend to drive prices to levels unimagined by conventional analytics, or indeed common sense. In short, when sentiment takes over from fact, FOMO (fear of missing out) comes to the fore, and many jump onto the speculative bandwagon. 

There are numerous examples of this phenomenon in the recent past, but there have been few, if any, occasions when high price levels – i.e. trading above the ‘round number’ – were consistently sustained. Bitcoin at (or over) 100,000 is a case in point. The cryptocurrency first breached this milestone in December 2024 apparently in the hope that President Trump would inaugurate a friendly environment for cryptocurrencies. The price fell back but another attempt was made to trade above 100,000 in May 2025, which finally petered out in mid-November. Today trading is within the 65,000-70,000 range.

Equivalently, in early February this year, two of the major US stock indices, the Dow Jones 50 and the S&P 500, pushed above 50,000 and 7,000 respectively but neither has (yet) been able to dig in at this level.

For much of Q1 2026, gold looked to be an exception given it held above $5,000 for over 70% of the auction sessions to 17 March after first reaching $5,093.55 on 26 January (am)). It finally fell back into the high $4,000s through the remainder of the quarter to close on 31 March pm at $4,608.35.

The gold price gained 5.05% during the quarter, opening at $4,386.85 (am), and closing, as stated, at $4,608.35 (pm). In other words, a creditable, if not stellar, performance building on the 10.86% gain achieved in Q4 2025.  However, these bland statistics mask the true story of the first three months of 2026 which proved to be unprecedented in terms of price moves, and which saw the gold price trading in a 29.04% range, low to high (by comparison to 16.09% in Q4 2025).

Prelude to War

During Q4 2025, there was briefly a sense that the principal drivers of the gold price were centred on the United States – and, by derivation, global – economy. Inflation appeared to be coming under control, at least in most developed nations, and the ongoing war in Ukraine (and so-called ’cease fire’ in Palestine) had for some time been incorporated into traders’ and investors’ thinking.

The first sign that this impression might be flawed occurred on 3 January when the US launched a military strike in Venezuela and captured incumbent Venezuelan president Nicolás Maduro and his wife, Cilia Flores. As Reuters reported, “Gold surges as US capture of Venezuela president spurs safe-haven demand.” To be specific, the gold price jumped 3.15% from the afternoon auction on 2 January to the equivalent auction on 5 January (the next trading day) i.e. from $4,352.95 to $4,456.40. Interestingly, despite Venezuela’s status as a major petrochemical state, the oil price barely moved (WTI dropped by around $1).

The next key geopolitical issue of the quarter actually began in December with a series of protests against the ‘old regime’ but began to become more of a global issue as Iranian leaders shut down the internet on 8 January and subsequently began to talk in terms of attacking US military bases in the region (such as occurred in December 2019) if the US  President began to think about intervening to support the protestors.

Undoubtedly, these moves and aggressive comments actively contributed to the extraordinary FOMO run in the gold price in January as the gold price gained 25% to top out at an all-time high of $5,501.70 on 28 January (am).  The US economy was also an important component of this run as the Dollar Index plunged by over 3% between 16 January and 28 January fuelled by poor US employment statistics, touching levels last seen in March 2022.

However, the gold price did not hold at these heady heights. The FT’s consecutive headlines tell something of the story: ‘Gold climbs to record highs after slide in dollar’ (28 January); ‘The precious metal feeding frenzy’ (28 January); ‘Gold and silver fall from record highs in metals market whiplash’ (29 January); ‘Gold and silver prices plunge as rally goes into reverse’ (30 January). Phew.

Predictions

During the excitements of January, two other pieces of precious metals news commanded attention. The first was an announcement from the World Gold Council that central banks had finally been discouraged by the high gold prices and had cut back on the buying spree which had lasted several years. In fact, January turned out to be a ‘lull’ rather than a reversal, with February recording a return to the recent norm with net purchases of 27 tonnes (2025 monthly average 26 tonnes), led by Poland (+20t), Uzbekistan (+8t) and Kazakhstan (+8t), according to the World Gold Council’s report 'Central Banks stay the course on Gold in February' (2 April).

The second, and of course most important news, was the publication of LBMA’s Annual Price Forecast Survey for professional analysts, where “Analysts see gold, silver, platinum and palladium breaching new highs throughout the year, including not just the $6,000.00 mark for gold but even $7,000.00 – while analysts expect silver to hit $160.00. Platinum could see highs of over $3,000.00 with palladium close on its tail.”

‘Epic Fury’

Once the gold price had fallen back from its 28 January spike, to trade in the high $4,000s and low $5,000s influenced, inter alia, by US economic statistics and President Trump’s nomination of Kevin Warsh to replaced Jerome Powell as Fed Chair, the market continued to be volatile through February to the momentous geopolitical moves on 26 February and onwards.

The curtain rose on the last of this quarter’s three acts on 27 February when President Trump launched, in concert with the Israeli Prime Minister Netanyahu, ‘Epic Fury’ which involved attacks on Iran and on Iranian-backed Hezbollah in Lebanon. Among the early results of these attacks was the death of Iran’s supreme leader, Ali Khamenei and several high officials as well as members of his family. In immediate response, the Iranians launched an estimated 170 ballistic missiles towards Israel, as well as Bahrain, Abu Dhabi, and Dubai, thus severely disrupting air transport in the region prompting concerns about precious metals deliveries, and suggestions of rerouting via other hubs. 

The gold price, reflecting the increasing tensions prior to the start of actual conflict, had been trending above $5,000 from 20 February and then, from Friday 27 February (pm) to Monday 2 March (am), unsurprisingly jumped 3.22%, touching $5,390.45. However, to the surprise of many, and despite the increasingly intense fighting, the price declined through March getting as low as $4,263.55 (am) on 23 March (i.e. lower than its opening price of the year), before recovering somewhat to end the month at $4,608.35.

This primarily downward move led to concern about whether gold was losing its safe-haven status. For example, the FT’s article of 25 March: ‘Tumbling price puts gold ‘haven’ status in doubt’. These and other comments failed, however, to understand that gold’s safe-haven status cannot be measured on a daily basis, but, as seasoned investors (such as the central banks referred to above) recognise, over an extended time period. 

Another familiar role for gold emerged, described by former LBMA Chair David Gornall as ‘the most accessible cash machine’.  In short, as the Straits of Hormuz closed and the oil price concomitantly rose (WTI up from $65.56 per barrel on 26 February to over $101 at end March), fears of a recurrence of inflation rapidly mounted, and stock markets tumbled. Traders and investors required cash to cover their positions and respond to margin calls, and the high liquidity of the gold market made it the first point of call.

Silver

This quarterly report is primarily, and necessarily, focused on gold, but silver was also exceptionally active. Indeed, one could summarise by saying that the silver price reacted to the same stimuli as the gold price, but even more so.

Silver began the quarter at $74.215, 152.4% higher than its 2025 opening price ($29.405), with some of the same drivers still in play including continue fears of a ‘silver squeeze’ reflecting the fact that silver consumption has outpaced production since 2021 (according to the Silver Institute), and also evidenced by the 10-15% price premium continuing to occur on the SGE over the London market.

Through the quarter, the price varied from an all-time high of $118.450 on 29 January, i.e. two days after the Iran conflict began, to a quarterly low of $67.230 on 23 March – thus a price range of 76.19% - exceptional even for silver! And in the end, performance in the first three months of the year was a pedestrian -2.06% despite the gain of towards 60% available to the market towards the end of January. Who said anything about profit taking?