Gold and Silver Prices Climb as US Dollar Weakens
Gold and silver prices continued their upward trajectory on Monday, building on significant gains from the previous trading session. This rally was primarily fueled by a weakening US dollar, which hit its lowest level since February 4, making dollar-denominated metals more affordable for international buyers.
Precious Metals See Substantial Gains
Spot gold prices increased by 1.4% to reach $5,029.09 per ounce, following an impressive near 4% surge on Friday. Similarly, US gold futures for April delivery advanced by 1.4% to $5,051.0 per ounce. Silver demonstrated even stronger performance, with spot prices climbing 2.86% to $80.25 per ounce, after registering a remarkable 10% gain in the previous session.
Market Factors Driving the Rally
Several key factors contributed to the precious metals rally. The Japanese political landscape provided additional support, as incumbent Prime Minister Sanae Takaichi secured a landslide election victory. This outcome reinforced expectations for looser fiscal policies and sustained pressure on the yen, creating favorable conditions for gold prices.
Market participants are closely monitoring upcoming US labor market data, scheduled for release later this week. This report is expected to provide crucial insights into the Federal Reserve's interest rate trajectory. Current market expectations anticipate at least two 25-basis-point rate cuts in 2026, with the first reduction projected for June. Gold, as a non-yielding asset, typically performs well in low-interest-rate environments.
Other Precious Metals Follow Suit
The positive momentum extended to other precious metals as well. Spot platinum prices rose 1.8% to $2,134.18 per ounce, while palladium prices gained 1.8% to $1,737.75 per ounce. This broad-based strength across the precious metals complex indicates strong investor interest in alternative assets amid currency fluctuations and monetary policy uncertainty.
Investors remain vigilant as they await the US labor market report, which could significantly influence future monetary policy decisions and consequently impact precious metals pricing. The combination of dollar weakness, political developments in Japan, and expectations for future rate cuts has created a supportive environment for gold and silver investments.
