Gold experienced an increase of over 3% on Tuesday, recovering from a nearly one-month low reached in the prior session, as market participants prepared for a lack of significant economic data this week resulting from a partial U.S. government shutdown. Spot gold increased by 3.7% to $4,837.16 per ounce by 0120, following a decline to a near one-month low in the previous session. Bullion reached an unprecedented peak of $5,594.82 on Thursday. U.S. gold futures for April delivery increased by 4.5%, reaching a price of $4,859.30 per ounce.
The U.S. Bureau of Labor Statistics announced on Monday that the highly anticipated employment report for January will not be published this Friday due to a partial shutdown of the federal government. The government experienced a partial shutdown on Saturday following Congress’s inability to reach an agreement to fund the Labor Department, along with other operations. Despite the U.S. Senate’s passage of a spending package on Friday, the House of Representatives was not in session. The House was scheduled to address legislation on Monday, with a conclusive vote anticipated on Tuesday. House Speaker Mike Johnson has conveyed a sense of optimism regarding the imminent resolution of the shutdown, suggesting it could conclude within days.
The dollar maintained its strength on Tuesday, buoyed by favorable economic indicators and evolving expectations regarding Federal Reserve policy, which overshadowed worries related to the partial U.S. government shutdown. USD A stronger dollar renders gold, priced in dollars, less accessible for holders of alternative currencies. Market participants anticipate a minimum of two reductions in the Federal Reserve’s interest rates by 2026. Non-yielding bullion typically exhibits superior performance in environments characterized by low interest rates.
On Monday, U.S. President Donald Trump revealed a trade agreement with India that reduces U.S. tariffs on Indian products from 50% to 18%, contingent upon India ceasing its purchases of Russian oil and easing trade restrictions. Spot silver increased by 5.9%, reaching $84.09 per ounce. It reached an unprecedented level of $121.64 on Thursday. Spot platinum increased by 3% to $2,183.64 per ounce following its peak of $2,918.80 on January 26, whereas palladium rose by 2.7% to $1,765.75.