How Shifting Debt Levels Are Driving Gold and Silver Prices

Global debt has surged to a record $324 trillion in Q1 2025, marking a $7.5 trillion increase in just three months. As governments escalate borrowing, investors are flocking to hard assets like Gold and silver, seeking refuge from eroding faith in fiat currencies. Public debt now nears 100% of global GDP, with 80% of countries seeing worsening debt-to-GDP ratios.

The U.S. national debt exceeds $36 trillion, while China’s debt is projected to hit 100% of GDP by year-end. This debt crisis has fueled a 29% year-to-date rally in gold and a 25–36% surge in silver, underscoring their role as stores of value. Silver’s climb to $39.40/oz—a 2011 high—reflects industrial demand, tight supply, and investor appetite.

Heavy bond issuance pressures yields upward, straining currencies. Negative real interest rates further amplify precious metals’ appeal. Central banks and ETFs are reinforcing inflows, cementing gold and silver as SAFE havens amid sovereign debt turmoil.