As traders evaluated the reweighting of a benchmark commodity index that begins next week, gold and silver stabilized at the start of the year following their biggest annual performances since 1979.
Bullion increased by up as 1.9% on Friday before losing the most of its gains during US business hours. After rising as much as 4% earlier, silver dropped.
There is worry that a wide index rebalancing could put pressure on prices in the immediate future, even if traders have noted that the metals should do well this year due to additional US interest rate reduction and currency weakness. Passive tracking funds might sell certain contracts to reflect the new weightings since the metals have risen.
The Bloomberg Commodities Index, a well followed benchmark for a basket of commodities, includes 9% silver futures. In contrast, the 2026 target weighting is little less than 4%, which means that almost $5 billion in holdings will need to be liquidated during the five-day roll period that begins next Thursday.
Gold futures are expected to be sold for about $6 billion. Daniel Ghali, a senior commodity analyst at TD Securities, wrote in a note on Friday, "We anticipate a massive 13% of aggregate open interest in Comex silver markets will be sold over the coming two weeks, to result in a dramatic repricing lower." According to him, less post-holiday liquidity could magnify price changes.
Although there was some volatility in late December as some investors booked profits and trade measures indicated overbought conditions, precious metals saw a fierce run higher last year.
A weaker US currency, easing Federal Reserve policy, and central bank purchases helped gold set a number of records in 2025. Prices were also raised by the demand for haven assets, which was fueled by trade disputes and geopolitical worries.
Over the course of the year, silver surged even higher than gold, breaking milestones and beyond levels that were previously unimaginable to all but the most ardent market observers.
Silver has gained from persistent worries that the US government would eventually impose import duties on the refined metal, in addition to the causes that helped gold.
Leading banks are in favor of greater gold increases this year, particularly in light of the Fed's anticipated rate cuts and President Donald Trump's restructuring of the US central bank's leadership.
Last month, Goldman Sachs Group Inc. stated that an increase to $4,900 per ounce was its base scenario, with upside risks. In New York, gold increased 0.2% to $4,328.35 an ounce at 3:36 p.m.
There was minimal change in the Bloomberg Dollar Spot Index. Palladium and platinum also saw increases, with silver rising 1.3% to $72.61 per ounce. Due to the fact that a number of important markets, such as China and Japan, are still on vacation, trading volumes are low.
As of October, assets that tracked the Bloomberg Commodities Index came to about $109 billion. A fully owned subsidiary of Bloomberg LP is Bloomberg Index Services Ltd., which administers Bloomberg Indices, including BCOM.
