Gold, Silver bounce back after sharp sell off

ISLAMABAD: Gold and silver prices rose more than 2 percent on Tuesday after a sharp sell-off.

The recovery came as the nomination of Kevin Warsh for US Fed chairman and CME Group tightening margin requirements pushed precious metals prices to a one-month low.

Spot gold rose 2.2 percent to $4,767.33 an ounce, according to Reuters, after hitting a near-month low on Monday. On Thursday, gold hit a record high of $5,594.82 an ounce. US gold futures for April delivery rose 3 percent to $4,791.10 an ounce.

Market analysts say the recent prices reflect more reasonable levels, as the market has seen unusual volatility in the past few weeks. According to them, the current recovery has brought prices closer to the levels seen at the beginning of the second half of January.

Gold prices rose about 13 percent in January, their biggest monthly gain since November 2009, while silver rose as much as 19 percent. However, a stronger dollar and tighter margin requirements after Warsh’s nomination added pressure on precious metals.

The CME Group raised margin requirements on precious metals futures after the market closed on Monday. Meanwhile, the U.S. Labor Department said its January jobs report will not be released on Friday due to the partial government shutdown.

Investors expect the Federal Reserve to cut interest rates at least twice in 2026, and gold, which yields no interest, typically performs better in a low-interest-rate environment.

Spot silver rose 2.8 percent to $81.61 an ounce, while platinum edged up slightly and palladium fell slightly.