1. Report Industry Investment Rating - Not provided in the content 2. Core Viewpoints of the Report - In 2025, the precious metals market saw gold leading the rise and silver booming. In 2026, precious metals will remain in a pattern of being prone to rise and hard to fall under the triple narratives of the politicization of the Federal Reserve, the decline of the US dollar credit, and the silver spot crisis [1][2][130]. - For gold, the weakening of the US dollar system will continuously boost its allocation value due to the Fed's independence crisis, the impact of the mid - term elections, and the long - term erosion of the US dollar credit [1][130]. - For silver, the supply - demand contradiction will be further intensified by low inventory, potential import tariffs, and strong demand from various sectors [2][131]. 3. Summaries According to the Directory 3.1 Precious Metals Market Review - In 2025, both domestic and overseas precious metals continued to be strong, with silver breaking through the historical peak in April 2011 in the fourth quarter. The gold - silver ratio declined by over 15% from its high in September, highlighting the relative strength of silver at the end of the year [9]. - The price of precious metals was mainly affected by policy uncertainties after Trump took office, trade tariff concerns, Fed independence concerns, and the Fed's restart of interest rate cuts. Silver's strength was due to multiple factors such as the advance release of demand, inventory transfer, and strong industrial and investment demand [18]. 3.2 Price Difference Fluctuation and Silver Squeeze Event Elaboration 3.2.1 Trade Tariff Event Leading to Price Difference Fluctuation - From the end of last year to the first quarter of this year, concerns about potential US gold import tariffs led to large - scale arbitrage trading, pushing up the price difference between COMEX gold and London gold. Similar situations recurred in the third quarter due to concerns about copper and other metal tariffs [22][25]. 3.2.2 Silver Spot Shortage and Frequent Squeeze Pressures - In the fourth quarter, the silver market faced frequent squeeze pressures. The key issue is the spot market squeeze, as the low supply elasticity and low inventory of silver cannot meet the strong physical demand. Multiple factors on the demand side have led to frequent long - squeeze short positions in the silver market [28][35][47]. 3.3 Loose Monetary Expectations Expected to Continue to Boost Precious Metals Valuation 3.3.1 Analysis of the Weakness of the US Dollar Index in 2025 - In 2025, the US dollar index was generally weak, falling by about 10% from nearly 110 at the beginning of the year to above 98. The "reciprocal tariff" policy in the second quarter was the direct trigger, and the Fed's interest rate cuts and technical balance - sheet expansion in the second half of the year further weakened the US dollar [70]. 3.3.2 The US Dollar Index in 2026 is Expected to Remain Weak Due to the Unchangeable Loose Monetary Path in the US - The market's expectations for the Fed's monetary policy in 2026 are more optimistic than the Fed's official stance. The US economy's downward pressure and the easing of inflation concerns will support the Fed to continue its loose monetary policy. The Fed's independence is being eroded, and the US mid - term elections in 2026 are expected to exacerbate this problem [77][79][97]. 3.4 Central Bank Gold Purchases are the Foundation, and Investment Demand is the Driver - Since the second half of 2024, the bull market in gold has been mainly driven by the rapid growth of investment demand, which has exceeded central bank gold purchases. Central bank gold purchases still provide important support for gold prices and are a key factor in stabilizing prices during corrections [110][113]. - Gold investment demand mainly includes gold bars, coins, and gold ETFs. Gold ETFs are an important factor affecting gold prices, and their investment usually increases significantly during the Fed's interest rate cut and balance - sheet expansion cycles [116]. 3.5 Precious Metals Market Outlook 3.5.1 2026 Annual Outlook: Gold and Silver Led the Rise in 2025 and Will Reach New Highs in 2026 - In 2026, precious metals will continue to rise, but investors need to pay a higher cost for "political premium." Gold is likely to rise due to the Fed's loose policy, risk aversion, and central bank gold purchases. Silver may outperform gold due to spot squeezes and industrial demand, but its volatility will increase significantly [130][131].