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Gold and silver prices remained firmly higher despite a much stronger-than-expected U.S. non-farm payrolls report. The U.S. economy added 130,000 jobs in January, far exceeding forecasts and marking the strongest reading since late 2024. Under normal circumstances, such data would pressure precious metals by boosting the U.S. dollar, Treasury yields, and expectations of tighter monetary policy. Instead, both metals held onto their overnight gains, with silver leading advances. Markets sharply reduced expectations for a March Federal Reserve rate cut, now pricing in less than a 15% probability and shifting toward only two potential cuts later in the year. The resilience in prices suggests that safe-haven demand, investor hoarding, and ongoing central bank gold purchases are outweighing interest rate concerns.
Silver’s strength is further supported by tight physical supply conditions, particularly in China. Stockpiles continue to be drained by both investment and industrial demand, creating pronounced backwardation and pushing near-term contracts to significant premiums. Domestic suppliers are reportedly struggling to meet order backlogs, while short sellers have been paying deferral fees to avoid delivery obligations, highlighting scarcity in available metal. Meanwhile, broader markets saw a firmer U.S. dollar, rising Treasury yields, and crude oil prices near 65 per barrel. From a technical perspective, gold bulls are targeting resistance near 5,250 while silver traders watch resistance levels above recent highs, with both metals maintaining moderately bullish market ratings. Source
J.P. Morgan Global Research expects silver prices to establish a higher floor in 2026, projecting an average price of 81 per ounce for the year, more than double the 2025 average. Analysts highlighted that silver is attempting to break away from gold’s influence amid extreme price volatility, with the gold-to-silver ratio narrowing to its closest level in 15 years. Policy developments played a significant role in recent price swings, including uncertainty around U.S. tariff reviews on critical minerals and the decision to avoid new tariffs on silver imports. Prices briefly weakened before rebounding, while the nomination of Kevin Warsh as the next Federal Reserve chair triggered a sharp selloff across precious metals, sending silver significantly lower alongside gold.
Despite short-term volatility and a stronger U.S. dollar weighing on demand, structural supply constraints remain supportive. Silver production is relatively inelastic because it is largely mined as a byproduct of other metals, while industrial demand, particularly from solar panel manufacturing, continues to underpin consumption. However, elevated prices are accelerating substitution and thrifting efforts, with manufacturers exploring silver-free technologies and reducing silver usage per panel. While these shifts may take years to materially impact the market, near-term price movements are expected to be driven primarily by investment demand, especially from China and India. J.P. Morgan forecasts silver prices will peak in the fourth quarter of 2026 with an average of 85 and rise to an annual average of 85 in 2027. Source
Gold remains supported above 5,000 per ounce, but BCA Research warns that short-term risks could lead to renewed volatility following last month’s historic selloff. Chief strategist Roukaya Ibrahim maintains a bullish long-term outlook and continues to hold positions first recommended in late 2022, including long gold versus copper, global equities, and favouring gold miners over broader equity markets. She argues that January’s peak is unlikely to mark the end of the structural bull market, though prices may face headwinds in the coming months. Historical comparisons suggest corrections within bull markets can last from a few weeks to several months, with recoveries to prior highs sometimes taking up to a year.
Speculative investment flows are seen as the primary near-term risk, particularly given gold’s recent parabolic rally driven by ETF inflows and strong participation from Asian investors. Momentum-driven and price-sensitive behaviour could amplify price swings if positions unwind. Despite this, continued central bank buying is expected to provide a longer-term floor, even if purchases slow during price spikes. Central banks are described as price-sensitive in the short term but largely price-insensitive over structural horizons as they diversify away from U.S. dollar reserves. China remains central to this dynamic, with the People’s Bank of China holding less than 9% of reserves in gold; raising that share toward emerging market averages would require substantial additional purchases, reinforcing long-term demand even if volatility persists. Source
Gold’s sharp price swings at the start of 2026 reflect heightened volatility rather than underlying weakness, with geopolitical tensions, trade uncertainty, and persistent investment demand pushing prices above 5,000 per ounce before triggering a rapid pull-back. The surge toward late-January highs fuelled speculative buying, while the nomination of Kevin Warsh as the next Federal Reserve chair acted as the immediate catalyst for a selloff. Despite this turbulence, gold still ended the month with strong gains. Van Eck emphasises that the core drivers supporting gold remain intact, including central bank accumulation, investor demand for safe-haven assets, inflation concerns, de-dollarization trends, and risks tied to equity market valuations. Periodic corrections are seen as a normal feature of a structural bull market that is expected to extend for several more years.
Gold mining equities, while posting solid gains, continue to lag the metal’s performance as valuation models adjust slowly to sustained higher gold prices. Analysts are increasingly extending elevated price forecasts through the latter part of the decade, which is expected to improve consensus expectations for earnings, cash flows, and sector valuations. This shift could support a broader re-rating of gold stocks. With companies preparing to release fourth-quarter and full-year results along with updated guidance, the sector is anticipated to demonstrate that even at lower gold prices miners are producing record cash flows and maintaining strong margins. These financial results are expected to underpin higher shareholder returns and continued investment in long-term growth projects. Source
Texas has launched a state-run bullion program that moves beyond simple storage to create a closed-loop precious metals system spanning manufacturing, vaulting, and direct-to-consumer sales. Through an official government storefront, the public can purchase state-branded products including the 2026 Texas Lone Star Coins in one ounce gold and silver, along with Texas Gold Bills made from thin layers of 24 carat gold. These offerings are integrated with the Texas Bullion Depository, allowing buyers to vault metals within a state-administered and audited facility, effectively creating a physical asset channel outside traditional banking systems. The initiative positions Texas as the first U.S. state operating as a sovereign distributor rather than merely recognising metals as legal tender or holding them at the treasury level.
The program emerges amid broader competition among states pursuing sound money strategies, with comparisons drawn to Wyoming’s focus on treasury holdings. Supporters link the move to global regulatory changes under Basel Three reforms, which elevated physical gold’s treatment in bank liquidity frameworks, and argue this is contributing to rising institutional demand for allocated metal. The rollout also coincides with strong precious metals prices and concerns about tightening physical supply, as refining capacity and delivery systems face growing strain. Industry participants warn that sustained demand from both investors and institutions could intensify supply pressures later in 2026. Source
Video - Physical Metals Enter the State Economy: Texas Unveils Official Bullion Program
Image Source: Kitco News
Gold futures extended their strong rally, with front month Comex gold rising sharply to settle above 5,070 per ounce, marking one of the highest closes on record. The advance came despite a stronger-than-expected U.S. jobs report, which showed robust payroll growth and a slight decline in the unemployment rate. The solid labor data further reduced expectations for near-term Federal Reserve rate cuts, effectively removing the likelihood of a March move and softening confidence around a June cut. Even so, traders continue to anticipate potential easing later in the year, helping sustain gold’s appeal amid ongoing monetary policy uncertainty. Attention now shifts toward upcoming inflation data and Fed commentary, both of which could influence the metal’s next directional move.
Technically, gold remains in a neutral-to-bullish posture after successfully transforming the psychologically significant 5,000 level from resistance into support. Holding above this threshold reinforces the broader bullish structure, while a break lower would expose support near 4,800. Year-to-date, gold has posted substantial gains, building on January’s strong surge and continuing higher into February. The sustained momentum highlights persistent buying interest and underscores gold’s resilience even as markets adjust to shifting rate expectations. Source
Gold continued to hold above the $5,000 an ounce level, but faced renewed pressure following stronger-than-expected U.S. employment data. The Labor Department reported that 130,000 jobs were added in January, significantly beating forecasts of 66,000, while the unemployment rate edged down to 4.3%. Despite maintaining key technical support, gold experienced selling pressure in the immediate reaction, even as spot prices traded slightly higher on the day near $5,045. Strong labor market data reinforced expectations that the Federal Reserve may not need to rush into cutting interest rates, limiting gold’s ability to attract fresh buying momentum.
The report also signalled that wage inflation remains a concern, with average hourly earnings rising by 0.4% to $37.17, exceeding expectations and marking a 3.7% increase over the past year. At the same time, downward revisions to previous months’ job figures suggested that growth had slowed more than initially reported, providing a mixed picture of economic strength. Analysts noted that the combination of resilient employment conditions and persistent inflation pressures gives the Fed flexibility to remain patient on monetary policy decisions. Source
Gold and silver experienced extraordinary volatility in January, reaching record highs before suffering violent, technically driven sell-offs at month-end. Gold’s surge reflected a repricing of political and institutional risk rather than traditional macroeconomic catalysts, as markets increasingly questioned the credibility of fiscal discipline, central bank independence and the stability of fiat systems. Rising geopolitical fragmentation, the weaponisation of financial infrastructure and growing distrust in policy neutrality have contributed to what appears to be a new monetary regime. In this environment, gold’s role as neutral, non-sovereign outside money has strengthened, with investors and reserve managers seeking assets insulated from political discretion, currency debasement and counterparty risk.
The broader shift is characterised by declining confidence in the U.S.-led global order, increasing concerns over capital conflicts and a structural reassessment of reserve asset safety. As financial systems are more frequently used as tools of statecraft, gold is re-emerging as a politically neutral reserve asset rather than merely an inflation hedge. Meanwhile, silver’s dramatic reversal was largely driven by leveraged liquidation and thin liquidity conditions, masking underlying strength supported by robust industrial demand, constrained supply and eroding inventories. Despite extreme short-term volatility, structural drivers for both metals remain intact, anchored by geopolitical uncertainty, reserve diversification trends and tightening physical markets. Source
Gold’s sharp selloff on January 30, following its surge toward $5,600 per ounce, is characterised as a positioning and volatility reset rather than a breakdown of gold’s long-term investment thesis. Christopher Gannatti of WisdomTree argued that the magnitude of the decline fits historical patterns where liquidity, leverage and crowded positioning trigger abrupt repricing events. He noted that gold’s recent rally had compressed what are typically longer-term moves into a very short time frame, leaving the market vulnerable to a violent correction once momentum became overstretched. Similar episodes, including the 2013 plunge and the 2020 dash for cash, demonstrated how gold can temporarily behave as a liquidity source during systemic stress rather than as a pure hedge.
The selloff is framed as part of a broader regime repricing dynamic tied to shifts in expectations around monetary policy, real interest rates and the U.S. dollar, rather than a reassessment of gold’s strategic role. Gannatti emphasised that examining performance across different investment vehicles such as GLD and GDX, alongside equity benchmarks, reveals that the drawdown was severe but isolated when viewed against strong longer-term returns. Year-to-date and multi-year performance remain positive, reinforcing the idea that extreme volatility often reflects market mechanics rather than structural failure. The episode highlights how rapid adjustments are increasingly common in elevated volatility regimes, with sharp declines representing tactical reassessments instead of durable regime shifts. Source
A widening divergence is shaping the U.S. economy, with financial markets surging while consumer conditions weaken. December retail sales were flat and consumer delinquency rates climbed to 4.8%, the highest level in years, yet equity trading volumes exceeded $1 trillion daily and major indices hovered near record highs. This split reflects a heavy concentration of global capital flowing into U.S. markets, largely driven by investor demand for exposure to dominant technology and artificial intelligence stocks. International liquidity is amplifying market activity, reinforcing momentum in a narrow group of large-cap names even as broader economic indicators signal strain among consumers.
Gold’s resilience above $5,000 per ounce is attributed to steady structural demand rather than speculative excess, with the metal increasingly viewed as a currency alternative amid concerns about debt, deficits and financial system stability. Corporate behaviour further illustrates the imbalance, as major firms such as Alphabet issued massive debt, including ultra-long maturities traditionally associated with sovereign borrowers, highlighting their balance-sheet strength and financing flexibility. Strength in precious metals extended to silver and platinum, supported by industrial and investment flows, while Bitcoin lagged, reflecting shifting liquidity dynamics and profit-taking by long-term holders. Market leadership remains concentrated in large technology firms, reinforcing a multi-speed economic landscape where asset appreciation diverges sharply from consumer fundamentals. Source
Video - Silver ETF Volume Beats S&P 500: The ‘Abnormal’ Signal & What Comes Next
Silver prices have started to stabilise in the elevated $80-an-ounce range after recent extreme volatility, but the market remains fundamentally supported by persistent supply deficits. The Silver Institute highlighted that 2026 is expected to mark the sixth consecutive year of a global silver market deficit, driven by tight physical supply, geopolitical uncertainty, and ongoing questions around U.S. policy and Federal Reserve independence. Coin and bar demand has strengthened, and global exchange-traded product holdings stand at approximately 1.31 billion ounces, underscoring continued investor interest amid broader macroeconomic uncertainty.
Investment demand is forecast to be the primary driver of silver’s price trajectory this year, with physical investment expected to rise 20 percent to a three-year high, while Western and Indian investors show renewed interest. Industrial demand, particularly in the solar sector, is projected to decline slightly, but overall electrification trends, including AI technologies, data centres, and automotive applications, will continue to support silver consumption. Jewelry demand is expected to fall by more than 9 percent, with China as an exception due to growing product innovation and consumer interest. Total supply is forecast to grow modestly, yet the market is projected to remain in a 67 million ounce deficit, reinforcing a bullish outlook. Source
Recent extreme swings in gold and silver prices, including historic selloffs followed by rapid recoveries, are being interpreted as normal commodity behaviour rather than signs of dysfunction. Michael Khouw of YieldMax explained that commodities often move farther and faster than investors expect, and rising prices naturally coincide with higher volatility. The recent sharp correction after near-parabolic gains was predictable and healthy, helping the market digest rapid moves while creating new layers of resistance. Spot gold and silver have since stabilised, and institutional activity suggests that rebalancing rather than a wholesale exit is driving recent market flows.
Khouw emphasised that the long-term bull case for precious metals remains intact, noting that corrections provide opportunities to manage risk without undermining fundamentals. Positive institutional flows during the drawdown indicate confidence in gold and silver as stores of value, while asymmetric trading strategies like zero-cost collars allow investors to capitalise on volatility. Comparing gold to real assets such as housing shows it continues to preserve purchasing power, reflecting its traditional role amid debt monetisation and currency debasement. Overall, volatility is an inherent feature of gold and silver during secular rallies, not a flaw, and recent price action aligns with historical commodity behaviour. Source
Gold has climbed back above $5,000 an ounce amid renewed geopolitical uncertainty and rising global sovereign debt, highlighting its role as a strategic portfolio diversifier rather than a risk-free asset. Joy Yang of MarketVector Indexes emphasised that while gold’s recent volatility after reaching record highs can be unsettling, its non-correlated risk profile compared with equities and bonds is precisely what gives it long-term value. She advised investors to focus on strategic allocation, letting fundamentals guide decisions instead of chasing short-term price momentum, noting that gold continues to deliver strong one-year and multi-decade returns despite temporary swings.
Yang pointed out that growing government debt in developed economies, including expansionary fiscal policies in Japan, reinforces gold’s role as a hedge against credit risk and currency debasement. She cautioned that volatility is an inherent feature of the market and should not deter long-term investors, as strategic reallocation can gradually integrate gold into diversified portfolios. Despite comparisons to volatile assets, gold remains a key safe-haven asset, offering resilience against systemic risks and acting as a stabilising component amid broader market and fiscal uncertainties. Source
Gold is expected to reach $5,900 an ounce by year-end as declining real U.S. rates and continued central bank purchases support demand for the non-yielding metal. UBS analysts highlighted that recent volatility, including the largest daily decline since 2013 and the largest daily gain since 2008, has been driven by shifts in expectations around Federal Reserve policy and the appointment of Kevin Warsh, who is seen as doveish on rates. Despite short-term swings, gold has gained around 16 percent year-to-date, reflecting sustained investor interest amid geopolitical uncertainty and ongoing central bank accumulation.
The analysts emphasised that a further decline in real rates lowers the opportunity cost of holding gold and should boost ETF demand, while other structural drivers such as sovereign buying remain intact. UBS also noted that commodities broadly, including industrial and precious metals, are likely to continue performing well due to supply-demand imbalances and geopolitical risks, making them an increasingly important component of diversified portfolios. Investors with large gold positions are encouraged to consider broadening exposure to other commodities to manage risk and capitalise on long-term trends. Source
Disclaimer: These articles are provided for informational purposes only. They are not offered or intended to be used as legal, tax, investment, financial, or any other advice.
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