It has been a rollercoaster week for gold and silver as Joe Biden secured the final states required to claim victory in the US election. For now, the result remains contested, with Donald Trump refusing to concede and launching numerous legal challenges in a bid to overturn the Democrat win.

With Biden’s lead currently in the millions however, it is expected that any challenges will ultimately fail to sufficiently alter the outcome, and that Biden will become the 46th President of the US on 20th January 2021.

Biden and vaccine image
Joe Biden's election win, and vaccine progress have seen large price movement in the past week.

Prices had been rising in response to the Biden win, before news broke that a Covid-19 vaccine by Pfizer has an estimated 90% effectiveness, with stock markets soaring in a knee-jerk reaction, and putting pressure on precious metals.

Gold had risen by 3.77% over the course of the election week and was once again approaching the $2,000 per ounce mark, before the vaccine news saw gold drop over $100 per ounce in just a few hours. Silver meanwhile had risen higher, and subsequently dropped lower, falling $2 per ounce.

111120 Dollar gold price chart
The price of gold in Dollars for the past month, showing high volatility in the past week especially.

Markets had already welcomed news of Joe Biden's (contested) win in the US election. The more predictable Democrat candidate is expected to cause less upset for businesses and international trade, while increased public spending and fiscal stimulus would see money-printing and low interest rates continue for years - all good for gold and silver.

The Pfizer vaccine gave investors fresh hopes that the lockdowns which have plagued economies all year may be nearing an end. Analysts, Joe Biden, and Boris Johnson have all been quick to caution against being too optimistic however; the logistics of rolling out a global vaccination program are far from easy, and it could be many months before enough are immunised to allow for lockdowns and social distancing to end.

Much of the economic damage caused by lockdowns - such as rising unemployment, and low growth - are unlikely to simply bounce back even after widespread global vaccination. Those businesses which collapsed will not simply return, while QE, and low interest rates are here to stay for some time, and will continue to support demand for gold and silver.

A new President, and progress in the fight against coronavirus has clearly been welcomed by stock markets, but long-term are unlikely to change the outlook for the global economy, and with volatility high, gold and silver remain a great way to protect your wealth in a world of money-printing and inflation.