Gold (GC=F) trimmed gains on Monday but was still within striking distance of a new record as pending labor data this week could push prices in either direction.
Gold futures hovered around $4,300, less than $100 off its October high. Meanwhile, silver (SI=F) also inched closer to its record north of $64 hit last week, capping a stunning rally for precious metals.
Gold and silver have risen steadily after the Federal Reserve implemented its third cut of the year last week, signaling next year will likely include looser monetary policy.
President Trump has also expressed his preference for a new Fed Chair to take over Powell’s position when his term ends in May. The shortlist includes White House National Economic Council Director Kevin Hassett and former Fed governor Kevin Warsh.
The expectation of lower rates has put pressure on the US dollar index (DX-Y.NYB), lifting commodity prices invoiced in greenback currency.
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Analysts expect gold’s next move could come on the heels of the US nonfarm payrolls data for October and November, due on Tuesday.
“If the data point to a meaningful slowdown, I believe this would reinforce bets on rate cuts and push gold to test higher levels,” XS.com senior market analyst Rania Gule said.
“Conversely, stronger-than-expected data could trigger a limited correction, though it would not, in my view, alter the underlying bullish trend,” Gule added.
The strategist noted gold’s rise this year has placed it at “the forefront of the financial landscape as a strategic hedging tool rather than merely a speculative asset.”
UBS strategists on Monday said they “expect gold prices to be supported by lower real yields and continued US dollar weakness as the Fed’s easing cycle likely continues into early 2026.”
The firm expects gold will reach $4,500 per ounce by June 2026.
Earlier this month, Goldman Sachs analysts reiterated a “structurally bullish” outlook for the precious metal as central bank demand remains robust. Their target, however, does not take into account whether more US investors decide to own it as a way to diversify their portfolios.
“As several investors have recently called for positive gold allocations, we see significant upside to our end-2026 $4,900 gold price forecast in a scenario where there’s additional investor diversification because current gold positioning remains low,” the analysts noted.
Ines Ferre is a senior business reporter for Yahoo Finance. Follow her on X at @ines_ferre.
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