Gold and silver prices extended their rally on Monday, with spot gold trading above the $5,000 mark as a weaker U.S. dollar boosted demand for dollar-priced metals and investors positioned ahead of key U.S. economic data later this week.
Spot gold rose 0.9% to $5,004.61 an ounce by 0748 GMT, following a sharp 4% surge in the previous session. U.S. gold futures for April delivery gained 1% to $5,026.30.
Silver also advanced strongly, climbing 3.7% to $80.89 an ounce, adding to nearly 10% gains recorded on Friday. The metal remains below its all-time peak of $121.64 reached on Jan. 29.
The U.S. dollar hovered near its weakest level since Feb. 4, making gold and other precious metals cheaper for buyers using other currencies.
The yen strengthened after Japanese Prime Minister Sanae Takaichi secured a decisive election victory over the weekend, adding to downward pressure on the greenback.
Market participants are focused on U.S. employment and inflation reports due later in the week, which are expected to shape expectations around the Federal Reserve’s interest rate path.
Non-yielding assets such as gold typically benefit in low-rate environments, as investors look for alternatives to interest-bearing instruments. U.S. rate futures currently reflect expectations of at least two quarter-point rate cuts in 2026, with the first likely around mid-year, according to CME’s FedWatch tool.
San Francisco Federal Reserve President Mary Daly said on Friday that one or two more rate cuts could be necessary if labour market conditions weaken further. Silver’s recent surge has been driven by strong speculative interest and its dual role as both a precious and industrial metal, with demand tied to electronics, solar power and battery manufacturing.
Among other metals, spot platinum slipped 0.7% to $2,081.23 an ounce, while palladium fell 0.3% to $1,707.31.
Trading volumes were elevated in early European hours as investors adjusted positions ahead of the U.S. data releases, which include the monthly non-farm payrolls report and consumer price index figures.
Market participants said any signs of cooling inflation or softer job growth could reinforce bets that the Federal Reserve will shift toward easing later this year.