Gold and Silver Rally as Democrats Projected to Take Congress, Dollar Slips

Precious metals climbed strongly on Wednesday morning while the dollar lost ground, as traders reacted to the results of the U.S. midterm elections.

By 4:32 a.m. ET, spot gold had risen 2.97% to $4,044.90 an ounce, and spot silver surged 4.27% to $51.90 per ounce. In futures trading, front-month gold contracts gained 2.94% to $4,056.40, with silver futures up 4.54% at $52.01.

The rally extended across the metals complex. Platinum advanced 3.38% to $1,463.95, while palladium jumped 5.57% to $985.50.

The market moves came with vote counting still under way and Democrats projected to have secured control of the House, alongside several governors' offices flipping to the party. U.S. stock futures broadly declined as results arrived, Treasury yields moved lower, oil prices edged modestly higher, and the U.S. dollar index gave up roughly 0.3%.

Rhona O'Connell, head of market analysis for EMEA and Asia at StoneX, wrote in a note on Tuesday that a Democratic sweep of both chambers of Congress should support gold, since interest rates and the dollar would likely face downward pressure. She said such an outcome would bring "fiscal brinkmanship, institutional friction, both leading to uncertainty," and noted that "the Iran war and a weaker dollar would compete with [the] impact of [a] hawkish Fed."

"Less fiscal stimulus argues for lower long yields and a softer dollar, offset by debt-limit premia in bills and a Fed leaning towards another hike," she added.

The gains follow a turbulent stretch for the metals. Gold and silver staged record-breaking rallies in 2025, climbing 66% and 135% respectively as investors sought safe haven assets amid geopolitical uncertainty and wider market volatility. That momentum has faded this year, however, as rising inflation, surging bond yields and hawkish central banks undercut support. Gold remains down more than 7% year-to-date, and silver has fallen nearly 28%.

Spot gold also rose on Monday as oil prices pulled back, leaving it on track for a weekly gain of about 3.7%.

Daniela Hathorn, senior market analyst at Capital.com, cautioned in a Tuesday note that the recovery is still fragile. "The challenge for precious metals is that geopolitical uncertainty is not automatically translating into safe-haven demand when investors are also concerned about restrictive monetary policy," she said. "They also face the risk of liquidation during sharp equity selloffs, as investors sell profitable or liquid positions to raise cash."