Oil Price Rally Revives Inflation Risk Trade, Boosting Gold and Silver

Gold and silver prices rose in late-afternoon U.S. trading Monday as investors balanced weak labor data against a rebound in oil prices, Treasury yields, and Fed rate-hike expectations.

The S&P 500 slipped from record territory, falling 4.53 points to 7,753.11, while the Dow Jones Industrial Average dropped 60.95 points to 53,975.98.

July payrolls fell by 23,000, and prior months were revised lower, pushing the implied probability of a September Fed rate hike down to 44.4% from 54.7% before the release.

The relief trade faded Monday as the rate-hike probability climbed back to 51.7%, while the 30-year Treasury yield rose 5 basis points to 5.244%, near its July 31 closing high of 5.253%.