Gold and Silver Prices Experience Market Volatility Ahead of Key US Data
Safe-haven assets, including gold and silver, turned volatile during Tuesday's trading session, interrupting a two-day recovery rally. Investors appeared cautious, holding back on fresh bets as they awaited the release of pivotal US economic data. This information is crucial as it could significantly shape the outlook for US Federal Reserve monetary policy in the coming months.
Gold Futures Retreat After Sharp Rally
Following a substantial jump of nearly $100 per troy ounce in the previous session, the April gold futures contract on the Comex exchange experienced a notable decline. It fell by $68 per ounce on February 10th, reaching a daily low near the $5,011 mark. Despite this pullback, the precious metal managed to hold above the psychologically important $5,000 level for the second consecutive session, indicating underlying support.
Investors are keenly focused on upcoming US economic indicators for clues regarding the Federal Reserve's future policy direction. The highly anticipated January jobs report is scheduled for release on Wednesday, with expectations pointing towards signs of labour market stabilisation. Furthermore, critical inflation data is due on Friday. These reports are paramount as non-yielding bullion, like gold, typically performs well in a low-interest-rate environment.
The Federal Reserve is widely expected to maintain steady interest rates at its March meeting. Market pricing currently suggests the possibility of two rate cuts later in the year, adding another layer of complexity to investor calculations.
Economic and Political Factors Influencing Sentiment
Adding to the pre-data jitters, White House economic adviser Kevin Hassett commented on Monday that US job gains might slow in the coming months. He cited softer labour force growth and higher productivity as potential contributing factors to this deceleration.
Concerns over the Federal Reserve's independence were also stirred. President Donald Trump's nominee for the next Fed chair, Kevin Warsh, expressed support for a new accord between the US central bank and the Treasury Department, a proposal that has sparked debate among market watchers.
Silver Prices Dip Amidst Supply Concerns
Silver prices, which serve a dual role as both a precious and an industrial metal, also faced downward pressure. The March silver contract on Comex eased by $2 per ounce, settling at an intraday low of $80.25.
Meanwhile, a significant development is unfolding in the physical silver market. Silver inventories on the Shanghai Futures Exchange (SHFE) have plunged to their lowest levels in nearly a decade. This sharp decline underscores growing tightness in the global physical silver market and raises serious concerns over supply chain stability.
Latest data reveals that silver available for delivery on the SHFE has dwindled to approximately 350 tonnes, marking the lowest level since 2015. According to CEIC data, specific inventories stood at 318.546 tonnes as of February 9, 2026, down from 349.900 tonnes reported just days earlier on February 6, 2026.
This represents a dramatic decline of more than 88% from the all-time high of 3,091.112 tonnes recorded on January 12, 2021. The figures highlight the extent of the drawdown in China's exchange-held silver stocks over the past several years, pointing to potential supply-side pressures.
Domestic Market Performance in India
In the domestic Indian market, trading activity was relatively muted. The April gold futures contract on the Multi Commodity Exchange (MCX) traded flat at ₹1,58,178 per kilogram. Conversely, the March silver futures contract on MCX recorded a decline of 1.17%, trading at ₹2,59,551 per kilogram as of 8:00 PM.
The market remains in a holding pattern, with global cues from US data and underlying supply dynamics expected to dictate the near-term direction for both gold and silver prices. Investors are advised to monitor these developments closely and consult with certified financial experts before making any investment decisions.
