Gold and Silver: Safe-Haven Assets in a Turbulent 2025

As 2025 unfolds, investors are navigating a landscape shaped by heightened geopolitical tensions, inflationary pressures, and shifting economic policies, particularly in the United States. Against this backdrop, gold and silver have reemerged as critical safe-haven assets, offering stability in uncertain times. While equities continue to deliver strong returns in certain markets, precious metals stand out as a hedge against economic volatility, with experts forecasting continued strength in gold and a growing silver deficit that could reshape the market.

One of the most notable trends of 2025 is the ongoing rise of gold as a preferred asset class. Alexandre Drabowicz, Chief Investment Officer at Indosuez Wealth Management, emphasizes that gold’s role as a store of value remains as relevant as ever. Central banks continue to accumulate gold, further reinforcing its status as a global reserve asset. Drabowicz points to historical data that highlights gold’s impressive appreciation over the decades, illustrating how it has maintained purchasing power even amid economic upheavals. This long-term stability has driven both institutional and retail investors toward gold, particularly in light of growing concerns over the fiscal policies of Donald Trump’s second administration. Analysts at BMO Capital Markets argue that Trump’s emphasis on protectionism and high tariffs will likely stoke inflation, further increasing demand for gold as an inflation hedge.

Despite gold’s dominance, silver is quietly shaping up to be an equally compelling investment opportunity. The silver market is expected to register another supply deficit in 2025, marking the fifth consecutive year of shortages. Industrial demand remains the key driver, with silver’s applications in green technologies and electronics continuing to expand. The global push for renewable energy, particularly solar photovoltaics, is expected to reach new record highs despite policy uncertainties under Trump. In addition, the development of artificial intelligence and growing sophistication in consumer electronics have boosted silver consumption. However, silver’s investment performance remains complex, influenced by both economic policy and investor sentiment. Concerns over China’s economic trajectory have weighed on silver prices, contributing to an elevated gold-to-silver ratio. While industrial demand remains robust, uncertainty surrounding US trade policies could hinder silver’s broader appeal among investors.

At the same time, the investment landscape is undergoing a broader shift. While the “Magnificent Seven” tech giants—Apple, Microsoft, Alphabet, Amazon, Nvidia, Meta, and Tesla—continue to dominate US markets, experts warn that sector rotation may soon take hold. Drabowicz suggests that investors should look beyond mega-cap stocks and consider mid- and small-cap companies, particularly as market cycles shift. With the Federal Reserve expected to implement policy rate cuts, albeit at a slower pace, real interest rates may decline, making precious metals an even more attractive alternative to traditional fixed-income investments.

In Europe, investor sentiment remains cautious. While certain stocks, particularly in Germany, continue to perform well, the broader outlook remains subdued. Drabowicz compares Europe to a tourist destination—appealing for short visits but lacking long-term investor commitment. This hesitancy reflects broader concerns about economic stagnation and the EU’s ability to respond effectively to global trade dynamics. Nevertheless, stock-picking strategies remain viable, particularly for investors willing to navigate the complexities of the European market.

Pension funds and institutional investors are also taking note of the shifting dynamics. The Swiss Federal Pension Fund PUBLICA reported strong returns in 2024, largely driven by equities and precious metal holdings. Notably, PUBLICA’s precious metals investments yielded a 33% return, underscoring the growing appeal of gold and silver as diversification tools. This institutional shift reflects a broader reassessment of traditional portfolio strategies, with investors increasingly prioritizing assets that offer resilience against economic shocks.

Ultimately, 2025 appears to be a year defined by volatility and strategic repositioning. While equities continue to offer selective opportunities, gold and silver remain at the center of investment strategies, providing stability in an era of uncertainty. With central banks accumulating gold, silver supply deficits persisting, and geopolitical tensions shaping global markets, precious metals are poised to play a pivotal role in portfolios worldwide. Investors who recognize these trends early may find themselves well-positioned to navigate the shifting tides of the global economy.