Gold Hits 10-Week High as Weak Jobs Data and Geopolitical Uncertainty Fuel Rally

Gold and silver prices have surged recently, with gold reaching a 10-week high of around $4,435 per ounce and silver gaining over 11% in just one week. The rally has been driven by several factors, including weaker US employment data, reduced expectations of a Federal Reserve rate hike, record central bank gold purchases, renewed ETF inflows, and geopolitical uncertainty.

The key trigger for the latest rally came from the weaker-than-expected US jobs report, which saw nonfarm payrolls fall by 23,000 in July. This led to reduced expectations of a Federal Reserve rate hike in September, with markets pricing around a 44% probability of a 25 basis point rate hike.

Central bank buying has also played a significant role in supporting gold prices. According to the World Gold Council's Gold Demand Trends Q2 2026 report, central bank net gold purchases reached 289 tonnes during the April-June quarter, which is five times the Q1 2026 level and the highest second-quarter figure on record.

The rally has been sensitive to macroeconomic developments, with stronger-than-expected US inflation potentially reviving rate hike expectations and putting pressure on both gold and silver. The upcoming US inflation data will be closely watched for its impact on expectations around the Federal Reserve's next policy decision.