Gold & Silver Prices: A Break-out or a Bubble?

In Africa, Ghana leads as the continent's foremost gold producer, producing about 150 tonnes in 2025, bolstered by investments and reforms. South Africa follows, producing 110 tonnes, then Burkina Faso at 94 tonnes, while Mali ranks third at 65 tonnes. For exports, Ghana surged to over USD 11 billion in 2024, overtaking South Africa's USD 8.17 billion in value. Tanzania had a record year in 2025 with gold exports at 42 tonnes. Morocco tops silver production at 275 tonnes, followed by South Africa at 59 tonnes, followed by Eritrea at 48 tonnes. These nations drive Africa's economic growth through resource exports, amid challenges like sustainability.

On 5 February 2026 gold traded around USD 4,880 per ounce, down from its all-time high of USD 5,608 in January. Silver hovered near USD 78 per ounce, a sharp retreat from its January peak of USD 121.64. This surge and subsequent pullback raise questions: Are these precious metals headed for a complete record-breaking break-out, or is the rally merely a bubble inflated by global fears?

JP Morgan and Wells Fargo forecast a fine troy ounce of gold to average USD 4,747 in 2026, with end-year targets reaching USD 6,300, due to robust fundamentals. Silver projections are equally bullish, averaging USD 79.50 per fine troy ounce, potentially hitting USD 532 by year-end as per CoinCodex (AI driven) models. Drivers include escalating geopolitical tensions— USA strikes on Venezuela, threats against Iran, and trade wars—fuelling safe-haven demand. Central bank buying remains at record highs, to diversify from the weakening U.S. dollar. Inflation fears and fiscal concerns, amplified by Trump's policies and Fed independence debates, further bolster prices. For silver, industrial demand in green tech and AI adds structural support, which led to silver outpacing gold.

Sceptics warn of a bubble underpinned by transient fears. Gold and silver gained respectively 66% and 150% in 2025, followed by significant plunges—gold down 21% and silver 41% from peaks early in 2026 signalling overbought conditions and speculative purchases. However, underlying trends like de-dollarization where BRICS countries rather settle international trade deals with gold and persistent uncertainties, suggest a breakout is more likely than a bursting bubble - prices may have consolidated short-term for a breather but could shatter records by 2026 year-end!