By Jules Rimmer
Silver’s 60% gain in 2025 exceeds gold’s 45% return.
Having long since disconnected itself from marginal production costs, “gold is like the art market” now, quipped Citi’s analyst Maximilian Layton, as he lifted his target to $4,000 per ounce in the next quarter.
Gold (GC00) recently surpassed his previous price objective of $3,800 per ounce but, like many gold specialists, Layton is reluctant to call a ceiling on the commodity, given the abundance of cyclical and structural tailwinds. Despite the highest producer margins in 55 years, Layton remains tactically bullish and believes price momentum will likely be sustained through the fourth quarter of 2025.
Subject to many of the same drivers as gold, silver (SI00) has outstripped its precious metal peer by roughly 15 percentage points with a 60% rally so far in 2025. It too exceeded Citi’s previous target of $45 per ounce and Layton has upped his forecast here too, revising it to $55/oz, compared to Monday’s close of $47/oz.
While gold continues to be more closely followed by a wider range of retail and institutional investors, silver offers more beta in up markets and Citi points out that one day’s buying of gold by an exchange-traded fund can equal 10% of the whole silver market.
The report published Monday by Citi, and titled “Stay bullish gold and silver near term with a trailing stop,” distinguishes between structural and cyclical components behind the price appreciation.
Among the structural themes at play, Layton lists concerns about the U.S. debt mountain, the sustainability of the dollar’s DXY reserve status and the Fed’s independence. Cyclical factors pushing the price higher are misgivings about global growth, weakness in the U.S. labor market and general anxiety about the broad impact of America’s tariff policy.
Eventually, the team expects the physical gold market to respond to higher prices but waning jewelry demand and an increase in the circulation of scrap are slower-moving factors and will take some time to filter through into futures prices. At some stage in 2026, if growth, inflation and tariff fears are allayed, then Citi thinks it possible for a rotation out of gold and silver into copper and aluminum.
That’s then, though; for now Citi will take their cue for trading gold from near-term signals like the status of the Fed’s under-fire governor, Lisa Cook and the Supreme Court ruling on the legality of the Trump administration’s tariffs.
If Cook is dismissed, then the Fed will likely develop a more dovish stance on rates, and if the tariffs are struck down then the U.S. deficit will widen. Both of these outcomes would probably stimulate further demand for gold.
-Jules Rimmer
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