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Gold (XAUUSD) & Silver Price Forecast: Inflation, Jobs, and Tariffs Set This Week’s Tone

By:
Arslan Ali
Published: Aug 4, 2025, 06:07 GMT+00:00

Key Points:

  • Gold retreats after a two-day rally as the U.S. Dollar rebounds, but macro risks keep safe-haven demand intact.
  • July U.S. jobs data missed expectations with just 73K jobs added, lifting odds of a Fed rate cut to 64% by November.
  • Trump’s new 35% tariffs fuel safe-haven interest in gold and silver, adding to market uncertainty.
Gold (XAUUSD) & Silver Price Forecast: Inflation, Jobs, and Tariffs Set This Week’s Tone

Market Overview

Gold prices edged lower during the Asian session on Monday, retreating after a two-day climb as the U.S. Dollar showed renewed strength. The mild pullback comes amid a broader recalibration in risk sentiment, though ongoing concerns about economic growth and potential monetary easing continue to support gold’s safe-haven narrative.

Soft U.S. Jobs Report Fuels Rate Cut Expectations

Friday’s U.S. jobs report showed the economy added just 73,000 jobs in July, well below the forecasted 110,000 and down sharply from the revised June figure of 147,000. Meanwhile, the unemployment rate ticked up to 4.2%, signaling possible cooling in the labor market.

Bart Melek, Head of Commodity Strategy at TD Securities, commented, “The weaker jobs data improves the odds of a Fed rate cut later this year. Gold tends to benefit in low-rate environments, especially when macro risks are elevated.”

The CME FedWatch Tool now shows a 64% probability of a rate cut by November, up from 48% just one week ago.

Trade Tensions and Policy Uncertainty Add Tailwinds for Metals

In parallel, renewed trade risks have also underpinned safe-haven demand. President Trump’s announcement of a new 35% tariff on certain non-USMCA goods last week rattled market sentiment, prompting defensive positioning in gold and silver.

Although geopolitical factors are in play, market participants are focusing on monetary cues. With inflation still trending below the Fed’s 2% target, policymakers have room to act if further economic softness emerges in upcoming data.

Silver Holds Ground on Industrial Optimism and Haven Demand

Silver rose 0.12% on the day, buoyed by continued optimism around industrial demand linked to energy and infrastructure sectors. While the stronger dollar has capped upside momentum, silver remains supported by dual demand from both manufacturing and defensive investors.

This week, traders are closely watching key inflation and consumer spending data for further clues on Fed direction. As global uncertainties persist, both gold and silver are likely to remain central to risk-averse investment strategies heading into the fall.

Short-Term Forecast

Gold and silver may consolidate near resistance as overbought signals emerge, but bullish setups remain intact. Key levels at $3,344 (gold) and $37.26 (silver) will guide short-term breakout momentum.

Gold Prices Forecast: Technical Analysis

Gold – Chart
Gold – Chart

Gold (XAU/USD) has broken out of its descending channel, surging above the 50-EMA ($3,325) and 100-EMA ($3,332), signaling a bullish reversal. The sharp rally paused at resistance near $3,364, with consolidation just below this level suggesting a potential breakout continuation. If bulls sustain momentum above $3,364, the next targets lie at $3,384 and $3,401.

However, failure to hold above $3,344 could trigger a pullback toward the EMAs. RSI indicates overbought conditions, so short-term consolidation is likely before the next leg up.

The breakout candle and rejection of the channel’s lower boundary confirm a change in trend, favoring buyers on dips. Watch for a retest of $3,344 or bullish confirmation above $3,364 for trade opportunities.

Silver (XAG/USD) Price Forecast: Technical Outlook

Silver – Chart
Silver – Chart

Silver (XAG/USD) is attempting a bullish breakout after reclaiming the $37.08 level and testing above trendline resistance. However, upside momentum is facing pressure from the 50-EMA ($37.26) and 100-EMA ($37.64), both of which have capped previous rallies.

If buyers push through $37.26 with strong volume, the next target lies at $37.62, followed by $37.98. A daily close above $37.64 would mark a structural shift. On the downside, support is seen at $36.77, with a break below exposing $36.27.

The rising wedge structure suggests a cautious bullish bias, but confirmation is needed with a firm move above the EMA cluster. Watch for candlestick patterns near $37.26 for intraday setups.

About the Author

Arslan is a finance MBA and also holds an MPhil degree in behavioral finance. An expert in financial analysis and investor psychology, Arslan uses his academic background to bring valuable insights about market sentiment and whether instruments are likely to be overbought or oversold.

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