Gold, silver likely to rally as fiscal pressures reshape global outlook: Vallum Capital report

Gold and silver could witness strong gains as fiscal pressures, shifting real yields and currency concerns reshape global markets, according to a Vallum Capital report. Central bank buying and expectations of monetary easing are expected to support precious metal prices

New Delhi: Gold and silver are likely to witness a substantial rally as fiscal dominance and shifting real yields reshape the macro-outlook, a report said on Saturday.

The report from Vallum Capital said the recent correction merely re‑priced ownership rather than invalidating the investment thesis to accumulate precious metals. It further noted that a 2 per cent real yield threshold and a reversing Dollar Index are structural markers and signal a durable reversal rather than just a chart pattern.

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“The US Fed is structurally boxed in: hiking raises the cost of servicing $9.2 trillion in rollovers, and holding leaves real rates negative at the front end with CPI above target,” the firm said.

The report argued that either path leads to debasing the currency, which is the “setup gold has priced correctly through every prior cycle.”

Central banks bought 288.9 tonnes of gold in the second quarter of 2026, marking a 411 per cent surge quarter‑on‑quarter, even as Western ETF outflows reached 44.8 tonnes and jewellery demand fell 17 per cent.

The report noted that silver has outperformed gold by a huge margin in every cycle in which gold has made a sustained advance.

However, the current cycle from 2021 to 2026 has already produced silver at 263 per cent versus gold at 164 per cent, a 99-point outperformance, with the ratio still sitting at 69-fold against a long-run median of 45-fold to 50-fold.

Following Kevin Warch’s nomination as Federal Reserve Chairman, gold fell 25–30 per cent, wiping nearly Rs 23,000–28,000 crore from that year’s new inflows in mark-to-market terms. Gold later recovered from roughly $4,196 to ~$4,359, reaffirming ETFs and gold funds as the fastest-growing retail access route into the metal even through volatility.