Gold prices fell slightly today. What are the reasons and what are the expectations for the future?
Gold prices fell during trading on Thursday to around $5,060 per ounce, after reaching a high of $5,118 per ounce in the previous session.
This decline came amid a reassessment by the markets of the likelihood of interest rate cuts by the US Federal Reserve.
Despite the decline, gold remains above the important psychological level of $5,000 per ounce, reflecting continued fundamental support for the yellow metal.
Strong jobs data puts pressure on gold
The pressure on gold prices came after the release of stronger-than-expected US jobs data, with January employment recording its largest increase in more than a year and the unemployment rate falling unexpectedly, signaling a strong labor market at the start of 2026.
This data reinforced the Federal Reserve's cautious stance on monetary policy and supported the idea of keeping interest rates high for longer.
As a result, traders postponed their expectations for the next interest rate cut to July instead of June.
It is well known that rising or persistently high interest rates reduce the attractiveness of gold, as it is a non-yielding asset, increasing the opportunity cost of holding it.
All eyes on US inflation data
Investors are now awaiting the release of the US Consumer Price Index (CPI) report on Friday, which may provide clearer signals on the path of monetary policy in the coming months.
If the data shows a slowdown in inflation, bets on interest rate cuts could return to the forefront, supporting gold prices.
If inflation remains high, pressure on the yellow metal could increase, and interest rate cuts could be postponed, causing gold prices to decline, even if only as a correction.
Gold remains resilient despite volatility
Despite the recent decline, the price of gold continues to show clear resilience, managing to recover about half of its losses after a sharp 13% drop during two previous sessions earlier this month.
Prices also continue to be supported by several fundamental factors, most notably:
- Continued demand from central banks
- Continued global geopolitical uncertainty
- Investors' tendency to hedge against economic risks
Gold price outlook for the coming period
Gold is currently moving between two opposing factors:
- Strong US economic data supporting high interest rates, which puts pressure on prices.
- Geopolitical risks and continued investment demand supporting prices above $5,000.
The next trend in gold prices is likely to be directly linked to the results of US inflation data and developments in the Federal Reserve's monetary policy outlook.
