Oil hits four-month high amid Iran tensions
The oil price is rising again today on increasing concerns the US may carry out a military attack on Iran, a key Middle Eastern producer.
Brent crude is up 1.3% at $69.33 a barrel, its highest since late September, after president Trump warned Tehran yesterday that time was running out.
Trump declared that a huge US armada was moving quickly towards the country “with great power, enthusiasm and purpose”, as he urged Iran to quickly ‘Come to the Table’.
January’s sizzling gains follow a strong 2025 for gold.
Gold gained 65% last year, as investors sought out protection from inflation and geopolitical tensions (a trend that has accelerated since!).
And this morning, the World Gold Council has reported that gold demand hit an all-time high last year.
The WGC says global gold demand rose by 1% in 2025 to 5,002 metric tons, which it attributes to jitters over instability and trade.
John Reade, senior market strategist at the World Gold Council, adds:
“The biggest question this year will be whether investment demand is going to be strong enough to maintain the strength of the gold market.”
The WGC also reported that central banks’ purchases of gold fell by 20% last year.
Reade says:
“The highlight is definitely investment demand. The lowlight — the one people may be surprised about — is that central bank demand dropped.”
Silver hits $120/oz
Silver has climbed even faster than gold this year.
Silver is up a blistering 65% since the start of January, and hit $120 an ounce for the first time this morning.
Some speculators are turning to silver as they try to cash in on the precious metals boom.
The Straits Times reports that some Hong Kong residents trying to buy a bar of silver were disappointed:
After a precious metals shop in Hong Kong’s central business district announced that hundreds of silver bars had sold out for the day on Jan 28, murmurs of disappointment rippled through a waiting queue.
Despite increasing its supply to cater to strong demand, the store saw hundreds of bars snapped up in just over an hour.
The rise in precious metals prices is “breathtaking and profoundly scary”, warns Robin Brooks, senior fellow at Brookings Institute.
He writes:
The rise in gold is part of something much bigger… all precious metals prices are going through the roof and gold is a laggard compared to silver and platinum.
At the same time, we’re seeing government bond markets in high-debt countries like Japan under severe pressure, even as there’s a flight to safety into countries with low debt like Sweden, Norway and Switzerland. Gold is therefore a symptom of something much bigger. We’re at the start of a global debt crisis, with markets increasingly fearful governments will attempt to inflate away out-of-control debt. Gold is just one of many assets that are getting a “safe haven” bid as part of this phenomenon.
Dollar weakness is supercharging the rise in gold. It was only on Sunday night that we went above $5,000 and today we're already above $5,200. Dollar weakness is adding fuel to the fire for the crazy rise in precious metals...https://t.co/u358ES9y2d pic.twitter.com/jzQ3c7vqCk
— Robin Brooks (@robin_j_brooks) January 28, 2026
Introduction: Weak dollar drives gold over $5,500 an ounce
Good morning and welcome to our rolling coverage of business, the financial markets and the world economy.
The surge in the gold price is showing no sign of abating, as bullion continues to soar.
Gold has jumped over the $5,500 an ounce level this morning, just three days after hitting $5,000 for the first time, taking its gains so far this year to almost 30% (!).
It powered higher as investors continue to rush into safe haven assets, looking for protection against geopolitical and economic uncertainty.
Precious metals are also benefiting from the weaker dollar, which has lurched lower after president Trump indicated this week he was comfortable with the currency’s year‑to‑date softness. That only encouraged fears of monetary debasement, boosting gold’s attractiveness.
As Chris Beauchamp, Chief Market Analyst at IG, explains:
“That sound you hear is that of 2026 gold targets being furiously revised higher, as the price keeps climbing, and given renewed impetus by Trump’s comments on the dollar. This will have fans of the debasement trade cheering in their seats, as it reinforces their thesis.
Each time precious seem at risk of running out of bullish momentum, something comes along to rescue it. So long as international investors keep dumping the dollar, the future for gold looks bright indeed.”
Concerns around the independence of America’s central bank are also lifting gold.
Although the US Federal Reserve resisted pressure from Trump and held interest rates last night, it may cut rates once a new chair has been installed to replace Jerome Powell later this year. That could weaken the dollar further, and lift inflation – two conditions which are good for the gold price.
The agenda
10am GMT: Eurozone consumer/business confidence report
1.30pm GMT: US trade report for November
1.30pm GMT: US initial jobless claims report
3pm GMT: US factory orders data for November
