This ambiguity disappointed markets that had priced in a high probability of monetary easing in the third quarter. As expectations reset, the U.S. Dollar Index jumped over 0.5%, adding further headwinds to precious metals.

Gold Faces Pressure from Strong Economic Data

The ADP National Employment report showed private sector payrolls rose by 324,000 in July, far exceeding forecasts. While some indicators of labor softening linger, the data broadly suggests resilience in the job market.

This strength reinforces the Fed’s wait-and-see stance and weakens the investment case for non-yielding assets like gold.

“Powell is staying the course on inflation even as employment data shows mixed signals,” said Tai Wong, an independent metals trader. “Gold may retrace further, but long-term support remains intact due to macroeconomic uncertainty, rising U.S. debt levels, and de-dollarization trends.”

Silver Extends Losses Amid Risk Reassessment

Silver plunged 3.2%, briefly touching a three-week low as traders digested the Fed’s tone and adjusted for reduced policy easing expectations. The metal, more volatile and industrially sensitive than gold, remains vulnerable to shifts in growth sentiment.

With real yields firming and the dollar gaining strength, both gold and silver face near-term headwinds. However, geopolitical uncertainties and fiscal imbalances continue to offer a supportive backdrop for long-term investors.