Gold and silver advanced for a second consecutive session on Monday, supported by a weaker U.S. dollar and a technical recovery from last week’s lows. Spot gold rose 1.3% to $5 025.97 per ounce, reclaiming a foothold above the $5 000 threshold, while silver surged 4.7% to $81.55.
The immediate catalyst was broad dollar softness, which hit a one-week low, enhancing the appeal of dollar-priced metals. However, market attention has pivoted decisively toward critical U.S. economic indicators due later this week: the Consumer Price Index (CPI) for January, scheduled for Thursday, and the January jobs report, now expected on Friday after a delay due to the government shutdown.
These releases are seen as pivotal for Federal Reserve policy direction. Current market pricing reflects expectations for at least two 25-basis-point interest rate cuts in 2026, with the first fully priced for June. San Francisco Fed President Mary Daly recently reinforced the view that policy may need to adjust, citing potential labour market weakness. As a non-yielding asset, gold remains sensitive to shifts in rate expectations; softer inflation or employment data could strengthen the case for earlier easing and support further gains.
Conversely, resilient economic figures could temper the recent rally. Analysts also note silver faces a key technical barrier near $92.24, which must be decisively broken to confirm a more sustained uptrend.
Sentiment is guardedly optimistic but hypersensitive to incoming U.S. data. The rebound is viewed as a corrective bounce within a volatile trend, lacking conviction until the inflation and employment figures provide clearer signals. The bullish case for precious metals rests squarely on a cooling U.S. economy that prompts Fed dovishness. Should this week's CPI and jobs reports come in hotter than expected, it would likely pressure metals by pushing rate-cut timelines further into the future. Conversely, signs of moderating price pressures or a softening labour market would validate the current rally and could propel gold toward recent highs. Markets are in a holding pattern, with near-term direction entirely data-dependent.
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