In a forecast published earlier this month, economists at the bank attributed 2025’s loss of jobs momentum to business uncertainty created by President Donald Trump’s tariffs and trade policies.

“As a result both long-term and short-term business planning has remained difficult, and layoff and hiring rates have been low,” Michael Feroli, chief U.S. economist at JPMorgan, said in the report. “Businesses are hesitant to make sweeping changes to either grow or shrink their payrolls when they’re unsure what the next six months might hold.”

In addition, Trump’s immigration crackdown and deportation campaign have been more aggressive than expected, JPMorgan added.

This reduced supply of workers plus the relatively flat labor participation rate flat mean that the monthly job gains needed to keep unemployment steady could tumble to just 15,000 from 50,000. Despite the lower breakeven rate, unemployment will creep higher.

“The first half of 2026 will likely deliver uncomfortably slow growth in the labor market, with unemployment peaking at 4.5% in early 2026,” JPMorgan said, a week before the Labor Department released the delayed November jobs report that showed the rate climbing to a four-year high of 4.6%.

The bank blamed sluggish growth due to the labor supply shrinking from deportations, an aging population and fewer visas for workers and students.

Another factor in the early-2026 slump is artificial intelligence, which has spurred massive investment in equipment, software and data centers—but not so much job creation.

While there are still no signs yet of widespread job losses because of AI, some of the sectors most exposed to the technology have seen slower gains, JPMorgan pointed out.

But then the labor market will reverse course in the second half of the year, economists predicted, citing a more consistent tariff policy, tax cuts from Trump’s One Big Beautiful Bill Act, and additional rate cuts from the Federal Reserve.

“We believe supports are coming together that will arrest this labor market slowdown and revive activity growth later next year,” Feroli said. 

JPMorgan sees GDP growth in 2026 at 1.8%, with one-in-three odds of a recession, and inflation remaining sticky at 2.7%. 

Separately, Bank of America CEO Brian Moynihan expects Trump to de-escalate trade tensions next year, telling CBS News’ Face the Nation that an average tariff rate of 15% for a broad group of counties is “not a huge impact.”

Meanwhile, AI could be a wildcard that provides yet another boost next year.

“Usually, it takes several years for general purpose technologies like AI to boost productivity,” Feroli added. “A quicker realization of efficiency gains could lead to stronger GDP growth than expected.”

But that optimism contrasts with continued warnings from computer scientist and “godfather of AI” Geoffrey Hinton, who has said AI will replace more and more human workers.

During an interview on CNN’s State of the Union on Sunday, he was asked for his 2026 predictions after declaring 2025 a pivotal year for AI.

“I think we’re going to see AI get even better,” Hinton replied. “It’s already extremely good. We’re going to see it having the capabilities to replace many, many jobs. It’s already able to replace jobs in call centers, but it’s going to be able to replace many other jobs.”

North Korea said it conducted a long-range strategic cruise missile launch drill over the West Sea on Sunday as it continues to showcase its weapons capabilities amid regional tensions.

The white metal fell as much as 5% on Monday, after earlier spiking to a record $84 an ounce following five straight days of gains. A weaker dollar and escalating geopolitical tensions have added to the appeal of precious metals during an end-of-year jump to all-time highs for silver, gold and platinum. 

“Make no mistake: we are witnessing a generational bubble playing out in silver,” said Tony Sycamore, a market analyst at IG Australia.

Read More: Why Silver Has Been Surging Even More Than Gold

Silver’s rapid acceleration caps a yearlong rally for precious metals driven by elevated central-bank purchases, inflows to exchange-traded funds and three successive rate cuts by the US Federal Reserve. Lower borrowing costs are a tailwind for the commodities, which don’t pay interest, and traders are betting on more rate cuts in 2026.

In the last week, frictions in Venezuela — where the US has blockaded oil tankers — and strikes by Washington on Islamic State in Nigeria have added to the haven appeal of precious metals. The Bloomberg Dollar Spot Index, a key gauge of the US currency’s strength, fell 0.8% last week, its biggest weekly drop since June. A weaker dollar is generally supportive of gold and silver.

Silver is outshining gold for several reasons. For one, the market is thinner. Tighter inventories and liquidity that can evaporate quickly; while the London gold market is underpinned by around $700 billion of bullion that can be lent out in the event of a liquidity squeeze, no such reserve exists for silver. That historic supply squeeze happened in October.

Read More: Sold Out in India, Panic in London: How the Silver Market Broke

“The dominant driver of late has been a severe structural supply-demand imbalance in silver, sparking a scramble for physical metal,” said Sycamore. “Buyers are now paying a remarkable 7% premium for immediate delivery compared to waiting a year.”

Vaults in London have drawn sizable inflows since the October squeeze, but this has led to shortages elsewhere. In China, silver kept in warehouses linked to the Shanghai Futures Exchange last month hit the lowest level since 2015.

Added to that, much of the world’s readily available silver remains in New York as traders await the outcome of a US Commerce Department probe into whether imports of critical minerals pose a national security risk. The review could pave the way for tariffs or other trade curbs on the metal.

Read More: Precious Metals Craze Prompts China Fund to Turn Away Investors

Unlike gold, silver also has many useful real-world properties that make it a valuable component in a range of products like solar panels, AI data centers and electronics. With inventories near their lowest on record, there’s a risk of supply shortages that could impact multiple industries.

This prompted Elon Musk on Saturday to respond to a series of tweets on the supply shortage by saying on X: “This is not good. Silver is needed in many industrial processes.”

Technical indicators show the rally in silver may have run too hard, too fast. The metal’s 14-day relative strength index showed a reading of almost 80, far above the 70 that is considered to be overbought. 

Spot silver rose as much as 6% to a high of $84.00 an ounce before crashing 3.6% to trade at $76.47 as of 8:38 a.m. in Singapore. Gold fell 0.9% to $4,495.73 an ounce, below a record of $4,549.92 hit on Friday. Platinum and palladium both retreated after hitting records in the previous session.