London, Feb 3, 2026, 13:46 GMT — Regular session
Gold rebounded sharply on Tuesday and silver surged, as traders snapped up bullion after last week’s wipeout. Spot gold rose 5.3% to $4,913.59 an ounce by 1234 GMT and silver climbed 9% to $86.60; gold was bouncing from Monday’s low of $4,403.24 and remained below last week’s record $5,594.82. The U.S. Bureau of Labor Statistics said the closely watched January employment report will not be released this Friday because of a partial government shutdown.
The whipsaw has forced desks to rethink what “normal” looks like for the rest of 2026. On Monday, gold slid 5% to its lowest in more than two weeks and silver fell more than 7% as investors treated Donald Trump’s pick of Kevin Warsh to lead the Federal Reserve as a risk for higher-for-longer rates and a firmer dollar, Vivek Dhar at Commonwealth Bank of Australia said. CME’s higher margin requirements — the cash traders must post to hold futures positions — took effect from Monday’s close, adding to forced selling; ‘the scale of the unwind’ evoked 2008, Tony Sycamore at IG wrote. Reuters
After the slump, banks largely kept their 2026 gold price forecast above $6,000 as markets continued to price two Fed rate cuts this year, a tailwind for gold because it pays no interest: UBS analyst Giovanni Staunovo sees a new record above $6,200 later this year, while JP Morgan expects $6,300 by year-end and Deutsche Bank has reiterated a $6,000 target. Independent analyst Ross Norman called the drop “large and fast” but said prices were back where they were three weeks ago, and Tai Wong looked for a consolidation phase before another leg higher. Still, Fawad Razaqzada at City Index and FOREX.com warned it was “far too early” to say a bottom is in, even as WisdomTree argued the pullback could clear room for longer-term buyers. Reuters
Silver’s own 2026 price forecast is messier after the metal hit $121.60 on Jan. 29 and then slumped to about $78 on Monday, with analysts saying a more fundamentally supported range sits around $60-$70. Heraeus described January’s spike as the most extreme since 1980, while Ole Hansen at Saxo Bank blamed a “massive” retail frenzy and said the hunt for a floor now hinges on China and on volatility easing. APMEX imposed minimums on buy and sell orders in late January, and India’s Amrapali Group Gujarat saw customers “snapping up coins and bars,” its CEO Chirag Thakkar said; Michael Widmer at Bank of America put fair value at $60 and Rhona O’Connell at StoneX warned silver “is always a death trap”. Reuters
Warsh has signalled he wants a smaller Fed balance sheet, but market watchers say winding back holdings could be slow and politically tricky, especially if it tightens financial conditions while he pushes for lower short-term rates. The central bank’s assets swelled to about $9 trillion in mid-2022 before “quantitative tightening” — letting bonds run off without replacing them — pulled it down to $6.6 trillion by late 2025; the Fed began bill purchases again in December to keep liquidity ample. Joe Abate at SMBC Capital Markets called a meaningful shrink “a nonstarter,” while David Beckworth at the Mercatus Center at George Mason University said the Fed turns slowly. Reuters
But the 2026 outlook for gold and silver is not one-way. If Warsh leans harder into balance-sheet tightening than investors expect, the dollar could stay strong and yields could rise, dulling demand for metals that do not pay interest. Silver has an extra hazard: if China demand cools or retail buyers retreat, the move back toward $60 could be quick.
For now, traders are treating the plunge-and-bounce as a positioning story — leverage being flushed out, then rebuilt more cautiously. That may leave gold steadier than silver, which behaves like both a safe haven and an industrial metal tied to economic cycles.
The next catalyst is political: the U.S. House of Representatives is set to vote Tuesday on a deal that would end the partial shutdown and send a funding bill to Trump to sign. Metals traders will watch Washington for any quick turn in risk appetite, the dollar and rate expectations once the fiscal fight clears.
