Gold and silver prices edged lower after robust payroll data reduced expectations for interest rate cuts.

Gold and silver prices declined during Asian trading on Thursday after stronger-than-expected U.S. payrolls data dampened expectations for deeper Federal Reserve rate cuts, though losses were cushioned by ongoing safe-haven demand.

Precious metals largely held onto this week’s gains, supported by continued dollar weakness and elevated tensions between the U.S. and Iran, which kept demand for safe assets intact.

Spot gold dropped 0.7% to $5,051.26 per ounce, while April gold futures slipped 0.5% to $5,072.04/oz as of 01:36 ET (06:36 GMT). Spot silver fell 1.3% to $83.2505/oz, and platinum declined 1.6% to $2,107.30/oz.

Gold pressured as dollar rebounds on solid payrolls data

Gold came under pressure after January’s U.S. nonfarm payrolls report, released Wednesday, exceeded expectations. The stronger labor market reading reduced bets that slowing employment would prompt additional rate cuts from the Fed.

According to CME FedWatch, markets are now assigning a 94.1% probability that the Fed will keep rates unchanged in March, and a 78% chance of no change in April.

The upbeat data also triggered a rebound in the U.S. dollar overnight, weighing on metal prices. However, the dollar stabilized in Asian trade and remains slightly lower for the week, partly due to strength in the Japanese yen.

OCBC analysts noted that a sustained dollar recovery would require further evidence of resilience in the U.S. economy — a scenario that could still offer some support to gold.

“Structural headwinds — including uncertainty around Fed leadership succession and broader U.S. policy risks — suggest the dollar will need additional upside data surprises to maintain any rebound,” OCBC analysts said.

Even so, precious metals remained volatile after sharp swings over the past week amid heightened uncertainty surrounding U.S. monetary policy.

U.S. inflation data and Iran tensions in focus

Investors are awaiting further signals on the U.S. economy, particularly January consumer price index data due Friday. Inflation and labor market conditions remain the Fed’s primary considerations for rate decisions. Weekly jobless claims figures are also scheduled for release later Thursday.

Safe-haven demand continued to lend support to metals amid ongoing U.S.–Iran tensions. Although both sides reported some progress in nuclear talks over the weekend, Washington was reportedly preparing to send a second aircraft carrier to the Middle East.

President Donald Trump also urged Tehran to accept a deal with Washington and met Israeli President Benjamin Netanyahu on Wednesday, underscoring persistent geopolitical risks.

Sources: Ambar Warrick