Valentine’s rally: romance meets precious metals

Valentine’s Day is almost here, heralding an annual peak in demand for gleaming metals. Gold and silver are also attracting attention for quite different reasons currently…

Valentine’s is a popular day for lovers to propose. With more engagement rings sold, demand for precious metals such as gold and silver also increases. Jewellery remains a popular Valentine’s gift for everyone else as well. In the US alone, romantic souls spent as much as $6.5 billion on jewellery around Valentine’s Day last year (source).

Historically, gold and silver prices tend to rise in the run-up to Valentine’s Day due to higher demand. The Romance Rally actually begins even earlier, with the start of India’s wedding season in November (China and India are the largest consumer markets for gold).

It is important to also take the bigger picture into account when considering gold and silver prices. These prices are only partially determined by wedding proposals and seasonal peaks such as Valentine’s Day. Economic and geopolitical forces are actually much more important. After climbing for months, gold and silver reached record highs at the end of January. Then came an unprecedented reversal. Silver plummeted a staggering 31% in a single day, the biggest fall since March 1980. Gold lost around 11% of its value. Prices fell further in the following days.

The immediate cause was President Trump’s announcement of his nomination of Kevin Warsh as the next chair of the Federal Reserve. Warsh is seen as a moderate choice. The US dollar strengthened abruptly in response, lessening gold and silver’s appeal. Other factors also played a role. When the first losses occurred, this created a domino effect and investors rushed to sell. Even so, the silver price remains 16% higher than at the start of the year, and gold is 8% higher (situation as at 2 February 2026).

Almost half of all gold is being invested

In 2025, global demand for gold amounted to 4,999 tonnes. Investments accounted for 44% (gold ETFs, gold bars and coins), jewellery for 33% and electronics and technology for 6%, and 17% was bought up by central banks. Annual demand for gold investments increased by 59%, while the demand for gold jewellery fell by 22% (source).

These figures make the real drivers very clear. Not romance, but investors and central banks. Investors see gold as insurance. As protection against inflation. Against geopolitical tensions, Trump for example. Against misgivings about budgets and debt. Against uncertainty about interest rate policies. Due to all these factors and more, the price of gold increased by 65% in 2025 (source). Central banks are fully committed to this game and buy gold for strategic reasons.

Silver: industry versus investment

Silver is a different story. It is a precious metal, but also an industrial metal and protection against uncertainty. The greatest demand for silver comes from industry (59%). Only 17% is being used for jewellery, with 18% held as a physical investment (source).

In the past year in particular, investors (re)discovered silver’s usefulness as a buffer against unrest. Between 15 December 2025 and 15 January 2026 alone, private individuals poured nearly $928 million into silver ETFs (source). At Keytrade Bank, too, silver ETFs are included in the top ten most traded ETFs (situation as at January 2026).

Last year, the price of silver rocketed upward by 144% (source). There are several explanations for this development. China introduced export restrictions on silver (source), while the US added silver to its list of critical minerals (source). It is also part of a broader trend of countries using control over commodities as a geopolitical weapon, thereby driving up prices.

In addition, there has been increasing demand for silver for industrial use in semiconductors, electric vehicles and solar panels in recent years (source). For example, a single solar panel contains 20 grams of silver on average. The current market for solar panels is actually equal to the market for jewellery (source).

Finally, there has been a silver shortage for years now and stocks are shrinking (source). Approximately 75% of silver is produced as a by-product of other metals, meaning higher prices do not automatically drive up production (source).

Is it still the right time to invest?

After a scorching rally in 2025, the silver and gold locomotive was still chugging along nicely in the first few weeks of 2026, but then it slowed down considerably. Various analysts continue to see additional potential for gold.

JP Morgan is predicting a gold price of up to $5,055 per ounce by the end of 2026. Goldman Sachs says $5,400. The current gold price is around $4,800 (situation as at 2 February 2026).

Analysts’ predictions for silver are less favourable. UBS expects to see the price of silver drop to $70 per ounce by the end of 2026. HSBC predicts a price of $68, while JP Morgan is going as low as $58. The current silver price is around $83 (situation as at 2 February 2026).

Whether you should be interested in investing in gold and silver depends on your own risk tolerance and objectives. Possible considerations:

Arguments in favour of investing

The fundamental drivers remain intact. Geopolitical tensions, budget deficits and monetary uncertainty aren’t going anywhere. Central banks will continue to use gold as a strategic reserve. Silver remains at a structural deficit and industrial demand is growing. Moreover, a possible correction after such a strong rally could create an entry point for long-term investors.

Arguments against investing

After such an impressive rise, the chance of a continuing correction is also greater. Precious metals do not yield dividends or interest, only value growth. If inflation continues to cool or central banks decide to temper their purchasing policy, this can affect the dynamic. Silver is also subject to volatility and can fluctuate more than gold due to the smaller market and its industrial character.

Useful tips

• Spread your risk. There is room for precious metals in a diversified portfolio, but be sure to also leave room for other investments.
• Choose the right instrument. While physical gold and silver offer tangible protection, ETFs are often more practical and cheaper to hold. Keytrade Bank makes it easy to invest in gold and silver ETFs.
• Think long-term. Use precious metals for insurance, not a quick win. They are at their best in times of crisis, but performance isn’t always linear.
• Timing is tricky. No one can predict the top or bottom perfectly. Investing small amounts or taking profits regularly helps spread the timing risk.
• Take taxation into account. When you buy physical silver, you pay 21% VAT, as silver is considered an industrial metal. Gold is exempt from VAT. Conversely, any capital gain on gold falls under the capital gains tax that came into force this year, while silver is excluded (for now).

Conclusion

Gold and silver are not seasonal products. Valentine’s Day can give them a boost, but trends are set elsewhere. By interest rate expectations. By geopolitics. By central banks. By structural economic changes.

That means including gold or silver in your portfolio is best used as a means of diversification and protection against scenarios where other assets such as equities and bonds won’t do well.

Investing in precious metals?

Log in at Keytradebank.be or open the app and search for the name of a specific share in which you want to invest, or use the terms ‘gold’, ‘silver’ or ‘precious metals’ for ETFs.