Gold and Silver Prices Experience Modest Decline Amid Strong US Economic Indicators
Gold and silver prices witnessed a slight downturn on Thursday, February 12, as stronger-than-anticipated US employment data tempered market expectations for an imminent interest rate reduction by the Federal Reserve. This development highlights the ongoing sensitivity of precious metals to macroeconomic signals from the United States.
Current Price Movements and Historical Context
Spot gold prices edged lower to $5,080 per ounce during Asian trading hours, representing a marginal decrease. Simultaneously, spot silver prices experienced a more pronounced decline, falling by 2% to $82.2 per ounce. These movements occur against a backdrop of significant retreats from recent peaks.
Gold prices currently stand approximately 10.4% below their record high of $5,608.35 per ounce, while silver remains a substantial 48% away from its all-time high of $121.67 per ounce. This divergence underscores the varying volatility and market dynamics between the two precious metals.
Primary Drivers Behind the Price Correction
The recent price weakness stems primarily from unexpectedly robust US labor market data. According to Bloomberg reports, US payrolls expanded by the largest margin in over a year during January, while the unemployment rate unexpectedly declined. These indicators suggest continued resilience in the American labor market at the beginning of 2026.
This economic strength has reinforced the Federal Reserve's position to maintain current interest rates, with many traders reportedly shifting expectations for the next rate cut from June to July. Since precious metals like gold and silver do not offer yields, they typically become less attractive when interest rates remain elevated or are expected to stay higher for longer.
Market Resilience and Analyst Perspectives
Despite Thursday's early losses, gold demonstrated notable resilience by maintaining its position above the psychologically significant $5,000-per-ounce threshold. The metal has recovered approximately half of the losses incurred during the sharp sell-off that occurred earlier in the month.
Several financial institutions maintain optimistic outlooks for gold's trajectory. BNP Paribas SA projects bullion could reach $6,000 by year-end, while Deutsche Bank AG and Goldman Sachs Group Inc. have similarly expressed bullish perspectives. Analysts cite persistent factors supporting gold's appeal, including ongoing geopolitical tensions, concerns regarding Federal Reserve independence, and a broader shift away from conventional assets like currencies and sovereign bonds.
Technical Analysis and Near-Term Outlook
According to Jateen Trivedi, VP Research Analyst for Commodity and Currency at LKP Securities, gold traded firmly as market participants positioned themselves ahead of crucial US unemployment and non-farm payrolls data. "CME Gold held strong above $5,050 and traded near $5,066, maintaining support above the crucial $5,000 mark for the past few sessions, keeping the short-term trend intact," Trivedi observed.
Ponmudi R, CEO of Enrich Money, provided additional technical insight, noting that the broader uptrend for gold remains intact despite recent pullbacks. "COMEX Gold is trading within the $4,900–$5,100 band after correcting sharply from highs above $5,500–$5,600. Prices continue to hold above major moving averages, suggesting the corrective phase is maturing," he explained.
Ponmudi further elaborated that strong buying interest is evident in the $4,500–$4,700 support zone, with stability above $5,100 potentially opening a path toward $5,200–$5,300 and eventually enabling a retest of record highs.
Silver Market Dynamics and Forecast
Regarding silver, Ponmudi noted that while the long-term bullish structure remains intact, short-term conditions reflect extended corrective pressure, with prices slipping below key moving averages. "COMEX Silver is hovering near $82.20 after a sharp correction from record highs above $121. The $65–$70 zone remains a strong structural support band," he stated.
The analyst suggested that a sustained base formation above $83.50, followed by recovery and closure above $85–$92, could revive momentum toward $95–$105 and potentially facilitate a retest of prior highs. Industrial demand and supply constraints continue to support a constructive long-term view despite current elevated volatility.
This analysis incorporates inputs from Bloomberg and various market experts. Investors are advised to consult certified financial advisors before making any investment decisions, as this information is for educational purposes only and represents the views of individual analysts rather than investment recommendations.
