As gold and silver prices soar, these are the ASX precious metals stocks to watch

Against this backdrop of surging commodity and stock prices, the following investigation of the demand and supply dynamics shaping both metals is timely. We’ll draw on the latest industry data and investment bank research reports to explore the key demand- and supply-side factors influencing gold and silver, as well as provide detailed lists of the major ASX gold and silver stocks investors should be watching.

Demand-Side Factors

Gold and silver prices are being driven higher by a powerful mix of cyclical and structural demand forces. For gold, investment flows have surged as investors hedge against a cocktail of risks, including global tariff wars, sticky inflation, and the growing perception that the US Federal Reserve will eventually pivot to easier monetary policy. In a research report released on Friday outlining its major commodity forecasts*, investment bank Citi captured this backdrop, observing that “spending on gold has risen to levels even higher than during the second oil shock in 1980, to its highest level in over 50 years”.

This combination of strategic and structural shifts has helped push household and institutional allocations to gold to record levels, while silver has ridden alongside as a beneficiary of trends in both precious and energy-transition metals. For gold, demand is being reinforced by emerging market central bank purchases, which have doubled the share of gold in reserve assets in less than a decade. For silver, the structural surge in photovoltaic demand has created a near-continuous call on supply, while investor flows have returned after years of disinterest.

These factors create a feedback loop: strong price action attracts new inflows (particularly via increasingly popular ETF structures), which in turn legitimises the thesis for higher allocations. Against this backdrop, both gold and silver have become central to portfolio diversification strategies worldwide.

Key demand drivers for gold and silver:

• Safe-haven buying as investors hedge against recession risks, inflation, and tariff-related uncertainty.

• Central banks, especially in emerging markets, are expanding gold reserves as a diversification tool.

• ETF inflows and retail bar-and-coin demand strengthening after years of volatility.

• US dollar weakness and expected interest rate cuts bolstering investment demand.

• Rising use of silver in photovoltaics, electronics, and electric vehicles boosting structural demand.

• Jewellery demand in India and Asia acting as a consistent floor for both metals.

Supply-Side Factors

While demand has surged, the supply outlook for both gold and silver remains constrained, creating the conditions for structurally tight markets and further price squeezes. In a research report also released Friday titled “Australian Gold, Golden run to continue with A$6,000/oz in sight”, investment bank UBS pointed out that consensus expectations still understate industry headwinds, citing “lower grades, elevated sustaining capex and continued high capex with limited volume growth”.

Gold miners face the dual challenge of declining ore grades and rising operating costs, limiting their ability to capitalise fully on record prices. Australian investment bank Macquarie shared its view on the fragility of gold producers’ supply response in a recent research report titled “ASX Gold Sector Outlook, Post-reporting season positioning”, warning that “most large miners are struggling to bring on new projects, with pipelines increasingly thin and capex commitments often delayed”. Another local broking house, Bell Potter, observed in its latest sector review* that Australian gold producers have also underperformed their international peers due to disappointing FY26 production and cost guidance.

For silver, supply is even more structurally constrained because it’s primarily mined as a by-product of other metals – meaning its output growth is largely dictated by copper, lead, and zinc markets rather than by silver demand itself. This limited elasticity means that higher silver prices do not automatically translate into higher production.

The situation is further complicated by geographical and operational risks. In gold, a lack of major new discoveries has left companies heavily reliant on mergers and acquisitions to replenish depleting reserves. In silver, concentration in a handful of countries, such as Mexico, Peru, and China, introduces significant geopolitical and regulatory vulnerabilities. Recycling flows, once a reliable swing factor, have also lagged despite higher prices, with households and investors reluctant to part with physical holdings.

Key supply drivers for gold and silver:

• Declining ore grades and rising all-in sustaining costs restricting effective gold supply growth.

• Few new large-scale projects in the pipeline, with miners deferring growth capex.

• Scrap supply is constrained as households and investors hoard metal.

• Silver’s dependence on by-product production limits responsiveness to higher prices.

• Political and regulatory risks in key producer nations such as Mexico and Peru.

• Mergers, acquisitions, and exploration activity are emerging as the main avenues to replace depleting reserves.

Major Brokers’ Gold and Silver Price Forecasts

Brokers are broadly bullish on both gold and silver, though with some variation in their timelines.

Bell Potter: Recently lifted its long-term forecast for gold to US$3,200/oz, citing a firm foundation for further upside.

Canaccord Genuity: Recently lifted its long-term for gold forecast to US$3,858/oz (from 2029) and long term silver forecast to US$41.70/oz.

Citi: Targets gold at US$3,800/oz within three months, with a bull case above US$4,000/oz by year-end; sees silver averaging US$35/oz in 2026.

Macquarie: Expects gold to average US$3,850/oz in 2025, reflecting near-term strength before moderating thereafter.

UBS: Raised its forecasts for gold to US$3,825/oz in 2026 and US$3,650/oz in 2027, while maintaining a long-term anchor at US$2,800/oz.

ASX Gold and Silver Stocks to Watch