NEW YORK, United States / AsiaWire.IO / – Gold and silver prices jumped on Wednesday, while the US dollar fell, as projections pointed to major Democratic gains in the US midterm elections. Spot gold rose 3.4% to $4,061.30 an ounce, and spot silver climbed 5.1% to $52.29 per ounce. Front-month gold futures added 3.4% to settle at $4,073, while silver futures rose 5.1% to $52.28. The dollar index shed about 0.3%.
The moves came as vote counting continued, with Democrats projected to have won control of the House of Representatives. Several governors’ offices also turned Democratic. US stocks rallied as political risk eased, and Treasury yields moved lower. Oil prices declined. Gold’s 3.4% rise on Wednesday was its biggest daily gain since August 19, giving the metal fresh momentum after a difficult year.
Rhona O’Connell, head of market analysis for EMEA and Asia at StoneX, said in a Tuesday note that if Democrats won control of both chambers, gold should find support as rates and the dollar came under pressure. She said that outcome would bring “fiscal brinkmanship, institutional friction, both leading to uncertainty.” Less fiscal stimulus argues for lower long-term yields and a softer dollar, she said, offset by a Federal Reserve leaning towards another rate hike. She added that the Iran war and a weaker dollar would compete with the impact of a hawkish Fed.
Gains extend into Thursday
The rally continued on Thursday, when spot gold rose 1.9% to $4,134.83 an ounce in Asian trading, its highest level since October 22. Silver gained 1.7% to $53.12, while platinum rose 2.1% to $1,527.65 and palladium climbed 2.6% to $1,030.14. The yield on the 10-year US Treasury note fell to 4.87%. Citi has set a zero-to-three-month gold price target of $4,500 an ounce. Linh Tran, a market analyst at XS.com, said gold could stabilize above $4,000, opening a path toward $4,200 and then $4,400.
Both metals enjoyed record-breaking rallies in 2025, with gold surging 66% and silver 135% over the year. Investors sought safe-haven assets amid geopolitical uncertainty and broader market volatility. That momentum faded this year as rising inflation, surging bond yields and hawkish central banks removed support. Gold is still down more than 6% so far in 2026, while silver has tumbled around 26%.
Fed rate hike risk remains
Daniela Hathorn, senior market analyst at Capital.com, said in a Tuesday note that the recovery remains fragile. She said geopolitical uncertainty is not automatically translating into safe-haven demand when investors are also worried about restrictive monetary policy. Precious metals also face the risk of liquidation during sharp equity selloffs, she said, as investors sell profitable or liquid positions to raise cash.
The Federal Reserve left interest rates at 3.75% to 4.00% last week, with two policymakers favoring an immediate increase. Traders now see an 82% chance of a rate hike in December, according to CME FedWatch. Gold also fell after the Fed’s September decision. Energy markets remain volatile, with Brent crude above $115 a barrel last week amid the Iran war.