Gold and silver's unstoppable record-setting tear continues as Trump stirs up new trade fears

• The rally in gold and silver shows no signs of ebbing as markets digest fresh trade tensions.
• President Trump's push to have the US control Greenland has thrust tariffs back into the spotlight.
• Metals have soared in the last year on a handful of drivers, including the debasement trade and geopolitics.

New trade tensions as the US and Europe spar over Greenland are the latest catalyst that's sending investors flocking to gold and silver on Tuesday.

Gold jumped more than 3% to around $4,740 per ounce, and silver spiked 8% to top $95.20 an ounce. Investors have been rattled by President Donald Trump's latest fight with the European Union over Greenland. Trump has doubled down on his calls for the US to take control of the Danish territory. He said that the US would hit EU countries opposed to his takeover with a 10% tariffs starting on February 1, increasing the import duty to 25% in June if no agreement is hammered out.

EU leaders have discussed hitting back with tariffs of their own.

"Geopolitical uncertainty has boosted demand for both silver and gold just as they were taking off in near-parabolic fashion," David Morrison, senior market analyst at TradeNation, said. "They have become the havens of choice for investors, and this has been bolstered by recent US dollar weakness. Silver also has a strong back story."

Morrison said that the higher their prices rise, the greater the chance the market will see a correction, but with geopolitical uncertainty high and Trump showing no signs of taking steps to ease trade tensions, the rally in metals could continue for the foreseeable future.

As Trump heads to the World Economic Forum in Davos, Switzerland, investors are watching closely for updates on his trade plans and the fight over Greenland.

While gold has surged as a general hedge against macro volatility and geopolitical tensions, silver is up amid a handful of other factors, including a supply squeeze and applications in the AI buildout.

Morrison said previously that the reason silver is outpacing gold is likely due to short supply and the fact that it is a substantially smaller market. Demand for both metals is high, but silver may be the more tempting play for investors as it trades at a lower price per ounce.

"The prevailing view amongst the bulls is that silver is in short supply, while demand from both investors and industry remains strong," Morrison noted. "And, as with gold, this morning's drop in the US dollar has also added to the general bullishness."