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Gold held near its best levels since mid-June and silver ran to a seven-week high on Monday as traders wagered that Friday’s shock contraction in US employment has taken a September interest rate hike off the table, while Barrick Mining headed for its worst day since March after handing rival Newmont a stake in its prized Fourmile discovery for what analysts called too low a price.
The Comex December gold contract touched $4,421.50 an ounce in early trade, its highest since mid-June, and traded 0.3% higher at $4,411.20 by midday in New York. Spot gold rose 0.4% to $4,357.11. Bullion surged more than 7% last week, its biggest weekly advance since late January, after the US economy unexpectedly shed 23,000 jobs in July and hiring in the prior two months was revised lower.
Silver outpaced gold again, with the September contract climbing as much as 2.5% to $65.075 an ounce, topping $65 for the first time in seven weeks, before easing to $64.87, still up 2.2% on the day. Spot silver rose by a similar margin to $64.94, stretching the white metal’s gain over the past week to more than 12%. Platinum and palladium traded lower.
Silver’s rebound has been sharper than gold’s off the mid-July lows, when the metal traded below $56. Physical demand is firming in a market expected to remain in deficit through 2026: the Perth Mint’s sales of silver products jumped 65% from June to 486,043 ounces in July, Reuters reported. Even so, silver remains 9% lower for the year, a legacy of the January futures squeeze that briefly drove the front-month contract near $116 and the war-driven collapse that followed.
‘A little too low’
Barrick shares fell as much as 9.7% at the New York open, the stock’s worst drop since March, and were still down 6.5% by midday after investors balked at the $1.95 billion settlement that folds its Fourmile discovery into the Nevada Gold Mines joint venture and clears a key obstacle to the North American listing Barrick is targeting by year-end.
The deal value “looks a little too low given the quality of the asset,” Bloomberg Intelligence analysts wrote on Monday, putting the implied resource valuation at about $325 an ounce, terms that “arguably favor Newmont.” Citigroup said investor consensus had pegged Fourmile’s value at $10 billion to $20 billion, implying Newmont’s 38.5% share of the deposit could have commanded $4 billion to $8 billion before offsets.
Barrick has called Fourmile one of the century’s greatest gold discoveries, with potential for as much as 750,000 ounces of annual production, and the payment settles a Nevada feud with Newmont that had spilled into allegations of mismanagement at the joint venture. A multibillion-dollar Teck royalty on the deposit has already complicated the IPO math. Compounding Monday’s selling, Barrick’s second-quarter profit missed estimates on higher costs and Mali tax penalties, even as gold output rose 11% from the first quarter to 796,000 ounces.
Newmont, which emerged from the deal with the discount in its pocket, rose 2.9%. Elsewhere Agnico Eagle was little changed and Wheaton Precious Metals fell 1.1%, while the silver-levered names rallied with the metal: Hecla gained 3.1%, Coeur 3.2% and Buenaventura 1.1%.
CPI week
The jobs report has left markets treating a September hike as far less likely, though Fed policymakers remain divided over how to rein in inflation fueled by the months-long Middle East war. This week brings the test: consumer prices on Wednesday, expected to inch up 0.1% after June’s 0.4% drop, the first monthly decline in six years, followed by producer prices on Thursday.
“Market focus now shifts to US inflation and producer price index releases this week, which could prove crucial in determining the next move in interest-rate expectations and gold prices,” said Manav Modi, commodity analyst at Motilal Oswal Financial Services, in a Bloomberg note.
Rallying oil is complicating the dovish case, with Brent crude rising toward $86 a barrel on Monday after Iran and Oman ended the weekend still short of a final deal to reopen the Strait of Hormuz and Tehran-backed Houthi militants claimed an attack on a Saudi refinery near the Red Sea.
President Donald Trump signaled he is content to let economic pressure build rather than order fresh strikes, telling Axios the US is “low-keying it” as a naval blockade deepens Iran’s financial woes. Rising energy costs pushed 10-year Treasury yields up four basis points to 4.68% and lifted the dollar, capping bullion’s advance. Gold remains nearly a fifth below its level before the war began in late February.
“Even a low CPI print might not be enough to negate the concerns of the Fed’s hawks, which seem to focus on the durability of above-target inflation for the past four years,” said Thierry Wizman at Macquarie Group, in a Bloomberg note.
Speculators are not waiting for the data. Money managers and other large speculators added more than 15,000 Comex gold contracts to their net-long position in the week to August 4, taking it to nearly 198,000 contracts, the highest in more than six months, CFTC data released on Friday show. Gold-backed exchange traded funds in China extended their longest inflow streak since March, and the People’s Bank of China added 640,000 ounces to its reserves in July, a 21st straight month of buying and the biggest addition since October 2023.
Monday’s levels leave gold roughly flat for 2026, after a peak above $5,375 in late January and a bear-market low near $4,000 in late June.
(With files from Bloomberg)
