Precious metals rally as U.S. midterm results pressure dollar and yields

Traders Union
All News
Commodities
Precious metals rally on midterms

Highlights

Spot gold rises 2% to $4,005.40 and spot silver jumps 4% to $51.68 after U.S. midterm results shift markets.
Democrats projected to take House and key governorships, pressuring the dollar index by 0.3% and lowering Treasury yields, supporting bullion.
Despite today's rally, gold remains down over 7% and silver nearly 28% year-to-date, with analysts warning of fragile recovery and liquidation risk.

Election-driven gains across bullion markets

As reported by CNBC, spot gold is 2% higher at $4,005.40 an ounce by 1:30 a.m. ET, while spot silver jumps 4% to $51.68 per ounce after the U.S. midterm results. Front-month gold futures add 2.2% to $4,020.60, and silver futures rise 3.8% to $51.53.

Other precious metals also advance. Platinum rises 3.3% to $1,462.20, while palladium is up 3.8% at $969.33.

The market move develops as vote counting continues, with Democrats projected to win control of the House and multiple governors’ offices also shifting blue. U.S. stock futures broadly fall as the results come in, Treasury yields move lower, oil prices edge higher, and the U.S. dollar index loses about 0.3%.

Analysts see support, but recovery remains fragile

Rhona O’Connell, head of market analysis for EMEA and Asia at StoneX, says in a Tuesday note that dual Democratic control of Congress should support gold because rates and the dollar would likely come under pressure. She says the outcome would bring fiscal brinkmanship and institutional friction, both adding to uncertainty, while the Iran war and a weaker dollar compete with the effect of a hawkish Federal Reserve.

O’Connell adds that less fiscal stimulus argues for lower long yields and a softer dollar, although debt-limit premia in bills and a Fed leaning toward another rate hike remain offsetting factors.

Gold and silver posted record rallies in 2025, rising 66% and 135% respectively as investors sought safe-haven assets during geopolitical uncertainty and wider market volatility. That momentum has weakened this year as rising inflation, higher bond yields and hawkish central banks remove support from the metals, leaving gold down more than 7% year to date and silver lower by almost 28%.

Daniela Hathorn, senior market analyst at Capital.com, says in a Tuesday note that the recovery remains fragile. She says geopolitical uncertainty is not automatically translating into safe-haven demand when investors are also worried about restrictive monetary policy, and adds that metals also face liquidation risk during sharp equity selloffs as investors raise cash.

Our earlier article on Wall Street’s pre-midterm test described how the S&P 500’s run toward 8,000 was being challenged by a tougher backdrop of higher oil prices, elevated Treasury yields, and growing political uncertainty. It also noted that despite strong third-quarter earnings expectations, market breadth and concentration in AI-linked megacaps were raising volatility risks as investors positioned ahead of the election outcome.

This material may contain third-party opinions, none of the data and information on this webpage constitutes investment advice according to our Disclaimer. While we adhere to strict Editorial Integrity, this post may contain references to products from our partners.