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Informist, Tuesday, Jan. 13, 2026

 

MUMBAI – Commerzbank has raised its price forecast for gold and silver this year as geopolitical tensions flare up and political pressure mounts on the US Federal Reserve. Tight supply will give additional support to silver prices. The German bank now sees gold prices at $4,800 per ounce by mid-2026 and $4,900 per ounce by the end of the year. Similarly, the bank has revised upwards its silver price forecast to $92 per ounce by mid-2026 and to $95 per ounce by the end of 2026.

 

Gold and silver prices hit fresh all-time highs at the beginning of this week, surpassing the $4,600 per ounce and $86 per ounce levels, respectively. "The mass protests in Iran and the violent response of the mullah regime are providing tailwinds, making (military) intervention by the US government more likely. Previously, US President Trump's openly articulated plans to annex Greenland and US military action in Venezuela had already caused a stir," Carsten Fritsch, commodity analyst at Commerzbank, said in a report.

 

In addition, the dispute between the US government and the Fed is escalating after the US Department of Justice announced its intention to take legal action against Fed Chairman Jerome Powell. "Ostensibly, the case concerns the allegedly excessive construction costs for renovating the Fed building. In reality, however, the government is likely seeking to influence the monetary policy of the US central bank," Fritsch said. Specifically, US President Donald Trump has been demanding significantly larger interest rate cuts than the Fed has been willing to implement so far, he added.

 

The unpredictability of Trump's foreign policy and the latest attack on the independence of the Fed point to stronger demand for gold as a safe haven, which should also benefit silver. "Due to growing political pressure on the Fed and the appointment of a new Fed chair effective in June, our economists expect significantly larger interest rate cuts than the market anticipates," Fritsch said. This is likely to further damage market participants' confidence in the dollar as a safe haven.

 

Central banks in emerging markets and gold exchange-traded funds are therefore likely to continue to increase their gold holdings, ensuring robust demand, which should offset the price-related weakness in demand for gold jewellery, Fritsch added.

 

In the case of silver, there is growing demand from photovoltaics, e-mobility, expansion of power grids, and artificial intelligence. Physical supplies of silver are already tight after five consecutive years of supply deficits, as suggested by low inventories in China and declining inventories on the COMEX. "However, the sharp rise in prices could lead to a reduction in the use of silver in industrial applications (thrifting) or to silver being replaced by cheaper metals, where technically possible," Fritsch said.

 

Moreover, the very high prices could bring additional silver supply to the market, either through mine production or recycling. However, it is questionable whether this will be sufficient to alleviate the shortage this year, he added.  End

 

US$1 = INR 90.19

 

Reported by Ashutosh Pati

Edited by Ashish Shirke

 

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