Gold, silver extend losses after brief rebound

Gold and silver prices edged lower on Friday (January 30) amid a firmer US dollar, but remained on course for their strongest monthly performance in decades as investors continued to favour precious metals amid persistent geopolitical and economic uncertainty.

Spot gold slipped 0.9% to $5,346.42 an ounce in early Asian trade,a day after scaling a record high of $5,594.82. Despite the dip, bullion has surged more than 24% so far in January, marking its sixth consecutive monthly gain and its largest monthly rise since January 1980.

US gold futures for February delivery rose 1.3% to $5,390.80 an ounce, reflecting sustained investor interest despite short-term price pressure in the spot market.

Silver prices also edged lower, with spot silver down 0.2$ at $115.83 an ounce, after touching an all-time high of $121.64 in the previous session. The metal has climbed about 62% this month, putting it on track for its strongest monthly performance on record.

The modest pullback in precious metals came as the dollar index inched higher following the US Federal Reserve’s decision to keep interest rates unchanged earlier this week. Fed Chair Jerome Powell said inflation remained above the central bank’s 2 per cent target, reinforcing expectations that policy easing may proceed cautiously.

US economic data added to the mixed backdrop, with weekly jobless claims falling, signalling limited layoffs, though softer hiring trends continued to weigh on broader labour market sentiment.

Geopolitical risks also remained elevated. Reports that the US administration is weighing options against Iran sustained safe-haven demand, even as markets assessed the likelihood and scope of any escalation.

Analysts said investment-led demand has been a key driver of the rally. UBS recently raised its gold price forecast to $6,200 per ounce for 2026, citing stronger-than-expected investment flows into the metal.

Despite Friday’s dip, market participants said gold and silver continue to draw support from global uncertainty, positioning both metals for a historically strong close to the month.

In India, bullion prices tracked the global rally on Thursday (January 29).Gold prices in the national capital rose to a new record of ₹1.83 lakh per 10 grams (inclusive of all taxes) on Thursday (January 29), according to the All India Sarafa Association. Silver prices crossed the ₹4 lakh per kilogram mark for the first time,

climbing to an all-time high of ₹4.04 lakh per kg.

Demand moderates as prices surge

While prices remain elevated, physical demand has softened. The World Gold Council said India’s gold demand fell 11% in 2025 to 710.9 tonnes, weighed down by record-high prices and evolving consumer preferences. Demand is expected to remain lower in 2026.

However, higher prices sharply increased the value of demand. In rupee terms, India’s gold demand rose 30% year-on-year in 2025, reflecting the impact of soaring prices despite lower volumes.

Globally, total gold demand crossed 5,000 tonnes in 2025, driven primarily by investment demand as investors sought protection against economic uncertainty and geopolitical risks.

-With agencies inputs