The expert explained whether gold and silver products will rise in price in Ukraine amid the global rise in price of precious metals
31 December 17:10
The global precious metals market has experienced a significant decline. on December 29, after a long rise that had repeatedly led to historic highs, prices plummeted.
The price of gold, silver, platinum and palladium dropped significantly, triggering a wave of panic selling on the New York, London and Asian exchanges.
The price of gold fell by about 4-5%, from peaks of over $4,500 per ounce to around $4,350.
Silver lost between 9 and 14%, falling below $70-72 per ounce.
Platinum and palladium also moved away from record levels: platinum fell by about 6% and palladium by almost 13%.
The main reasons for the decline were massive profit-taking after a long period of growth, higher margin requirements, which forced some investors to close positions, and low liquidity at the end of the year, which exacerbated price fluctuations. Overall, this year has been a record year for the precious metals market amid expectations of lower interest rates, geopolitical instability, and growing investor interest. Despite the sharp decline, experts view it as a temporary correction, emphasizing that the underlying factors supporting the market remain strong.
After a period of rapid growth, which brought prices to historic highs, the precious metals market has entered a phase of sharp decline.
Analysts urge not to dramatize
In a commentary for Bloomberg, Societe Generale’s head of commodity investment research Michael Haig urged not to overestimate the scale of the decline, noting that the end of the year is traditionally characterized by extremely low liquidity. According to him, the main reason for the decline was profit-taking after the seasonally strong growth of gold and silver. The analyst recalled that over the past ten years, gold has risen in price by about 4% on average at the end of the year, and silver by almost 7%, which makes such corrections natural.
Wang Yanqing, an analyst at China Futures Ltd, noted that the market is dominated by a strong speculative atmosphere fueled by the hype around the limited physical supply of silver, which, in his opinion, currently looks excessive.
Measures to reduce risks
To curb speculative activity, some exchanges have already begun to tighten requirements. In particular, CME Group Inc. announced an increase in margin requirements for certain silver futures contracts on the Comex, which, according to experts, should reduce excessive risks.
Silver’s latest price surge came just two months after a full-fledged “squeeze” in the London market caused by inflows into ETFs and increased exports to India, which depleted already low stocks. Although the metal’s supply to London vaults has since resumed, much of the available silver is concentrated in New York. Traders are awaiting the outcome of the US investigation, which could potentially result in tariffs or other trade restrictions.
How much will gold and silver products rise in price
Gold and silver jewelry will rise in price in the same proportion as the metal itself on world markets. This was stated by economist Oleg Pendzin in an exclusive commentary for "Komersant Ukrainian".
“In any case, gold and silver jewelry will rise in price exactly as much as the price of gold as a monetary metal rises,” the expert said.
According to Pendzin, it is important to understand the difference between the exchange price of gold and its value in jewelry.
“When we talk about the exchange price of a monetary metal, it is the price of gold with a purity of 100%. This is pure metal,” he explained.
At the same time, jewelry in Ukraine has a much lower grade.
“Jewelry gold is conditionally 550, which means it contains only about half of pure gold,” the economist added.
Oleg Pendzin also drew attention to a significant difference in prices depending on the form of gold.
“Monetary metal in Ukraine can cost up to 7 thousand hryvnias per gram. In jewelry, it’s about UAH 3,700-3,800, and in a pawnshop, you’ll get only UAH 1,600-1,700 for a frame,” he said.
According to him, these nuances are often ignored by consumers, although they have a significant impact on the final price.
Gold deficit in Ukraine and its impact on the market
An additional factor behind the price increase is the shortage of gold in the domestic market.
“There is a certain shortage of gold in Ukraine due to the NBU’s decisions on currency regulation adopted in 2022 for the period of martial law,” Pendzin explained.
Due to difficulties with the import of the monetary metal, raw materials for the jewelry industry are supplied intermittently and at much higher prices.
Gold as a hedge against inflation
The economist believes that interest in gold will continue, as it remains one of the ways to preserve capital.
“It is a way to hide money from inflation of freely convertible currencies. The dollar and the euro depreciate in line with their own inflation,” Penzin said.
Forecast for 2026
Speaking about the outlook, the expert refrained from making precise predictions, but admitted that growth will continue.
“In 2025, we have already seen about 40% rise in prices. It’s hard to say what will happen in 2026, but the figure will also be significant,” he summarized.
Thus, despite the sharp drop in prices on global markets at the end of the year, experts do not see it as a change in the overall trend. Rather, it is a technical correction after the ultra-fast growth and massive profit-taking in the face of low liquidity.
The fundamental factors – geopolitical instability, expectations of monetary policy easing, and growing investor interest in defensive assets – remain relevant.
For the Ukrainian market, this means that even amid temporary downturns in global prices, gold and silver jewelry will continue to rise in price along with monetary metals in the medium and long term.
