Gold and Silver Slide as Strong Payrolls Put a September Fed Hike Back in Play

Gold's record run has hit a wall. Spot gold traded near $4,368 an ounce late Tuesday, down about 0.83% on the day and well off recent highs, while silver changed hands around $65.74. The trigger was Friday's August jobs report — and the market hasn't stopped reacting since.

The US economy added 162,000 jobs in August, comfortably above expectations, with the unemployment rate holding at 4.1%. After a run of soft labor data, that print flipped the narrative: the Federal Reserve raising rates at its September meeting is now firmly back on the table. Bullion dropped hard on the news, slicing through the $4,400 level that had been acting as support.

The pressure has compounded since. Brent crude climbed toward $100 a barrel, Treasury yields pushed higher, and the dollar firmed — a three-way squeeze on metals that pay no yield. Even renewed US-Iran tensions, which would normally hand gold a safe-haven bid, weren't enough to offset the rate-hike trade.

Traders are now bracing for this week's US inflation reports, including PPI. Stock futures slid for a third straight session as yields and oil climbed, a sign that risk appetite is thinning across the board ahead of the data.

For anyone buying physical metal, the read is straightforward: this is a meaningful dip after a long, steep rally, and the setup around the September FOMC looks volatile. Gold running to records made premiums and dealer spreads a live consideration; a pullback of this size changes the entry math, but it also comes with the risk of sharp two-way swings until the Fed's path is clearer.

CPM Group's Jeffrey Christian captured the near-term mood well, expecting gold and silver to stay choppy over the next couple of weeks as markets repeatedly reprice Fed odds — while still looking for higher prices over the coming months.