Gold edged higher on Tuesday, closing at $5,055 after briefly touching $5,069 intraday, as softer-than-expected January retail sales data pushed the US dollar lower and reinforced expectations that the Federal Reserve will cut rates at least twice this year.
The DXY index slipped to 96.8, extending its decline below the psychologically important 97 level, while the 10-year Treasury yield fell 3.9 basis points to 4.16%.
China’s central bank continued its gold accumulation campaign for a sixteenth consecutive month, with the World Gold Council projecting central bank purchases near 850 tonnes for 2026.
Despite the constructive backdrop, the session was notably subdued — a “snoozer” in the words of OANDA’s market wrap — as traders positioned cautiously ahead of Wednesday’s delayed Non-Farm Payrolls release.
Silver was the standout performer, surging 3.76% to close at $83.78 — its strongest single-session gain in over a week. The move extends the remarkable recovery from the historic crash that saw prices collapse from the $121 record high on January 29 to lows near $68 in early February.
The Silver Institute released its 2026 outlook, confirming a sixth consecutive annual market deficit with mine production expected at 820 Moz against surging industrial demand from solar panels, electric vehicles, and AI data center infrastructure.
JP Morgan’s Global Research team projects silver averaging $81/oz this year — more than double its 2025 average — while Bank of America’s long-term structural target of $309 continues to anchor the bull case.
The gold/silver ratio compressed to approximately 60.3, down from 61.5 in the prior session, signaling renewed industrial metal outperformance. Brent crude rose 1.56% to $69.11 as traders monitored US-Iran developments, while the S&P 500 gained 0.47% to close at 6,965.
The VIX ticked up slightly to 17.76, reflecting pre-NFP hedging demand. UBS maintained their view that the late-January sell-off was a “positioning shakeout, not a regime change,” while JP Morgan reiterated their year-end gold target of $6,300, describing gold as a “dynamic, multi-faceted portfolio hedge” in the current macro environment.
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