Institutions: Geopolitical stalemate continues to escalate, gold prepares for a move while silver shows divergent trends.
2026-04-28 12:07:23
Heraeus precious metals analysts stated that the extension of the ceasefire between the US, Israel, and Iran has not eased the pressure on the situation; instead, it has pushed the geopolitical situation towards a prolonged stalemate, and the potential negative impact has not yet been fully priced in by the capital markets. Considering the overall macroeconomic environment and supply and demand fundamentals, once the subsequent negative impacts have subsided, gold will resume its strong bull market, while silver, suppressed by high prices and caught in a tug-of-war between bullish and bearish demand, will show a clear divergence in its overall market trend.
Industry analysts say the indefinite regional ceasefire continues to amplify uncertainty in global markets.
The initial ceasefire briefly benefited precious metals and US stocks, with gold prices rising gradually and the S&P 500 index hitting a new high. However, subsequent disruptions to shipping in the Strait of Hormuz, coupled with the implementation of US measures to block Iranian ports, led to a significant reduction in global crude oil supply. The energy supply gap will continue to widen as the stalemate continues.
Analysts say the current stock market is ignoring the real economic risks posed by long-term geopolitical conflicts. Rising prices across the US will offset positive corporate earnings and suppress short-term rebound momentum in metals. If inflation rises rapidly, the Federal Reserve will be forced to raise interest rates, and the current crisis cannot be resolved by quantitative easing. Supply shortages are unlikely to reverse, and the probability of stagflation continues to climb, laying a solid foundation for a medium- to long-term rise in gold prices.
Global central bank gold allocation strategies are showing a clear polarization.
Industry data shows that Russia reduced its gold holdings by 6.5 tons in March, bringing the total amount sold this year to 22 tons. This was primarily used to cover its large fiscal deficit and to optimize its foreign exchange reserves, which have a high gold content. Analysts added that the scale of Russia's gold reduction is manageable, and the overall reserve decrease is minimal. Coupled with the continued increase in fiscal pressure due to the Russia-Ukraine conflict, small-scale reductions in reserves may become the norm in the future.
In contrast, Poland has continued to increase its gold reserves against the trend, raising its target amount and purchasing more gold in March. Its total reserves have steadily increased, and its gold holdings have surpassed those of the European Central Bank, demonstrating its unwavering willingness to hoard gold at high levels.
In terms of market trends, gold came under pressure and fell slightly, fluctuating narrowly below key price levels, and closed slightly lower for the day.
Silver prices were even weaker, failing to break through key resistance levels twice and continuing to hover at intraday lows.
From a fundamental perspective, the price of silver is showing increasing divergence. High prices are suppressing demand for silver in traditional jewelry, utensils, and photovoltaic industries, resulting in a year-on-year decline in overall industrial consumption. However, demand from emerging sectors such as new energy vehicles, computing hardware, and high-end energy storage is steadily expanding. Coupled with physical silver hoarding by many countries and increased holdings by funds in the market, investment demand has rebounded significantly. With the balance between bullish and bearish factors, it is difficult for the market to see a one-sided trend.
The entire market unanimously predicts that the Federal Reserve will hold rates steady at its April meeting and maintain the current benchmark interest rate.
Analysts say that compared to the interest rate decision itself, Federal Reserve Chairman Jerome Powell's post-meeting remarks are more indicative of market trends. His latest statements on inflation trends and the pace of interest rate cuts throughout the year will directly influence the short-term fluctuations of gold and silver. Precious metals as a whole are entering a wait-and-see phase in the short term.
Overall , geopolitical stagflation is favorable for the long-term strength of gold, and central bank gold hoarding is supporting the bottom of gold prices; silver is dragged down by high prices and weak demand, and investment demand alone is not enough to boost the market. In the short term, gold and silver are waiting for the Fed's policy signal, but in the medium to long term, gold has a much higher allocation value than silver.
Geopolitical tensions and inflationary pressures provide solid medium- to long-term support for gold.
Industry analysts say the indefinite regional ceasefire continues to amplify uncertainty in global markets.
The initial ceasefire briefly benefited precious metals and US stocks, with gold prices rising gradually and the S&P 500 index hitting a new high. However, subsequent disruptions to shipping in the Strait of Hormuz, coupled with the implementation of US measures to block Iranian ports, led to a significant reduction in global crude oil supply. The energy supply gap will continue to widen as the stalemate continues.
Analysts say the current stock market is ignoring the real economic risks posed by long-term geopolitical conflicts. Rising prices across the US will offset positive corporate earnings and suppress short-term rebound momentum in metals. If inflation rises rapidly, the Federal Reserve will be forced to raise interest rates, and the current crisis cannot be resolved by quantitative easing. Supply shortages are unlikely to reverse, and the probability of stagflation continues to climb, laying a solid foundation for a medium- to long-term rise in gold prices.
Central banks around the world are taking contrarian actions, subtly changing the landscape of gold reserves.
Global central bank gold allocation strategies are showing a clear polarization.
Industry data shows that Russia reduced its gold holdings by 6.5 tons in March, bringing the total amount sold this year to 22 tons. This was primarily used to cover its large fiscal deficit and to optimize its foreign exchange reserves, which have a high gold content. Analysts added that the scale of Russia's gold reduction is manageable, and the overall reserve decrease is minimal. Coupled with the continued increase in fiscal pressure due to the Russia-Ukraine conflict, small-scale reductions in reserves may become the norm in the future.
In contrast, Poland has continued to increase its gold reserves against the trend, raising its target amount and purchasing more gold in March. Its total reserves have steadily increased, and its gold holdings have surpassed those of the European Central Bank, demonstrating its unwavering willingness to hoard gold at high levels.
Uneven supply and demand in the silver market have put downward pressure on prices, resulting in a weak trend.
In terms of market trends, gold came under pressure and fell slightly, fluctuating narrowly below key price levels, and closed slightly lower for the day.
Silver prices were even weaker, failing to break through key resistance levels twice and continuing to hover at intraday lows.
From a fundamental perspective, the price of silver is showing increasing divergence. High prices are suppressing demand for silver in traditional jewelry, utensils, and photovoltaic industries, resulting in a year-on-year decline in overall industrial consumption. However, demand from emerging sectors such as new energy vehicles, computing hardware, and high-end energy storage is steadily expanding. Coupled with physical silver hoarding by many countries and increased holdings by funds in the market, investment demand has rebounded significantly. With the balance between bullish and bearish factors, it is difficult for the market to see a one-sided trend.
With the Fed decision approaching, short-term market sentiment awaits guidance.
The entire market unanimously predicts that the Federal Reserve will hold rates steady at its April meeting and maintain the current benchmark interest rate.
Analysts say that compared to the interest rate decision itself, Federal Reserve Chairman Jerome Powell's post-meeting remarks are more indicative of market trends. His latest statements on inflation trends and the pace of interest rate cuts throughout the year will directly influence the short-term fluctuations of gold and silver. Precious metals as a whole are entering a wait-and-see phase in the short term.
Overall , geopolitical stagflation is favorable for the long-term strength of gold, and central bank gold hoarding is supporting the bottom of gold prices; silver is dragged down by high prices and weak demand, and investment demand alone is not enough to boost the market. In the short term, gold and silver are waiting for the Fed's policy signal, but in the medium to long term, gold has a much higher allocation value than silver.
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