Gold and silver prices are on a wild ride. Here’s why it’s happening and what it means for Canadian investors and portfolios

Silver’s swings were even wilder (2). After soaring to record levels, it crashed 27% in a single day in late January — one of its worst days ever. It kept falling for a few more days before shooting back up to trade between US$73 to US$90 an ounce (roughly C$100 to C$120) through mid-February.

Feeling overwhelmed by all these numbers? You’re definitely not alone.

Here’s the basic idea: precious metals act like a safety net when markets fluctuate. When times get rough — or just plain weird (is the U.S. really going to invade Greenland?) — investors move their money into gold and silver for their stability.

Why metal markets are going haywire

Here are only four (of many!) distinct causes of this recent rollercoaster ride in precious metal prices.

Geopolitics: The first reason gold and silver shot up in January was global instability. On January 3, the United States invaded Venezuela and arrested the country’s president, causing an international uproar.

A few days later, President Trump and his team started talking again about invading Greenland, an independent territory under Denmark’s rule.

Eight European countries sent troops to Greenland to support Denmark. Trump responded by threatening to hit those countries with tariffs, jeopardizing a previous trade deal made in mid-2025.

Financial markets detest uncertainty and chaos (wars do nothing for global trade), so these events pushed investors to buy gold and silver as a safe place to park their money.

Tariff threats also tend to weaken the U.S. dollar. Since the dollar is used for most international trade and commodity pricing, a weaker dollar makes gold more attractive, which drives up its price. For Canadian investors, this created a double boost: gold prices rising in USD plus the currency exchange rate between CAD and USD (3).

In early February, tensions between the U.S. and Iran gave investors another reason to stick with precious metals.

Fed drama: The second reason, which actually helped pushed prices down, was President Trump’s announcement of a new Federal Reserve chair after publicly clashing with current leader Jerome Powell, whose term ends at the end of May.

On January 30, he nominated Kevin Warsh, a former Federal Reserve governor who served as an economic advisor to President George W. Bush. Markets responded well to this selection: when investors sold their gold and silver (causing their prices to drop), it showed they had the confidence in the new chair, according to market analysts (4).

Worries about the political interference with the Fed’s independence also seemed to ease, and the U.S. dollar got stronger.

Profit-taking: The third reason prices pushed downward is simple: when an investment gets expensive, some investors sell to lock in their profits — selling causes prices to dip.

Bargain hunting: After gold and silver prices crashed at the end of January, some investors thought the metals had become too cheap. They started buying again, which helped prices recover, one research analyst told Reuters (5).

What this means for Canadians

Big swings in the precious metals markets impact investors in several ways.

• Retirement accounts: Many Registered Retirement Savings Accounts (RRSPs) and Tax-Free Savings accounts (TFSAs) include some precious metals. According to Canadian financial advisors, the typical recommendation is to put between 5% and 10% of a portfolio into gold and other precious metals for diversification (6). Some advisors suggest ranges up to 5% if you’re conservative, while those focused on protecting wealth might go with 10% to 15% or more (7).
• Inflation protection: Canadians have long considered gold and silver as a protection when the dollar loses its value. If these wild market swings continue, it may be time to talk with a financial advisor about other low-risk investments that can handle ups and downs in both the dollar’s buying power and precious metal prices.
• Consumer products: When silver prices swing, it affects what you pay for everyday items, like smartphones, as well as clean-energy technology such as solar panels. Canadian silver miners supply major industries including electronics, solar energy and medical technology (8). When silver prices spike, manufacturers may eventually pass those higher costs on to consumers.

Most silver goes to industrial uses rather than jewelry or investments (9). A single solar panel, for example, needs between 15 and 25 grams of silver, while electric vehicles use up to 50 grams — about twice as much as gas-powered cars.

What’s ahead

Despite the dramatic ups and downs, precious metals are still way up compared to previous years. As of mid-February 2026, gold was still trading around US$5,000 an ounce — more than three times the US$1,550 price at the end of 2019 (10). Silver was trading around US$73 to US$90 an ounce, compared to under $20 at the start of 2020 (11).