Precious Metals Market Recap, August 7, 2026: Gold and Silver Rise as Soft Jobs Report Hits Rate Hike Odds

 

Market Recap (Aug. 7, 2026): Gold and Silver Rise as Jobs Report Tapers Rate Hike Expectations

(August 7, 2026) – The spot price of gold climbed more than $100 per troy ounce on Friday, capping off an excellent week that saw the metal add more than 7%, its largest weekly gain since January. Silver prices also jumped to end the week, adding nearly $1.50/ozt and gaining more than 9.3% since Monday. Silver outpaced gold on the week, driving the gold-silver ratio approximately 2.1% lower to close at around 68.24:1.

Friday’s market-wide price jump followed a worse-than-expected U.S. employment report. According to the data, the U.S. economy lost 23,000 jobs in July, a substantial deviation from the median forecast of a 95,000 gain in jobs added. Government jobs and jobs in the retail and hospitality sectors led the way, while payrolls increased by around 30,000 for private companies overall. The report also saw a downward revision to numbers in May and June, with a total retreat between these two months of 103,000 jobs.

This data could impact how the Federal Open Market Committee (FOMC) votes at its next meeting to decide interest rates. Previously, strong job market performance had boosted the likelihood that the Fed votes to raise rates, which could help curb inflation but would risk harming the labor sector by raising borrowing costs for businesses. Traders see Friday’s employment data as evidence that the Fed may delay raising rates, at least for the time being.

After the release of July’s employment report, CME FedWatch’s projected probability of a rate cut fell from 55% to 43% since Thursday, dropping from 67% one week ago. Rate hike odds in the long term remained high to end the trading week, although the likelihood of a larger hike retreated. The overall likelihood that the FOMC will vote to raise rates one or more times by the end of its December meeting fell from 84.4% on Thursday to 78.6% Friday. The probability of two or more rate cuts fell from a combined 42.9% to 34.1%.

Interest rate speculation has returned as a major force in the precious metals market after a lull in activity during a series of no-change decisions earlier in 2026. In 2024 and 2025, rate cut expectations drove demand, particularly in the gold market. Since the Federal Reserve is dealing with rising consumer prices and (until recently) a relatively strong job market, market expectations have flipped in favor of a rate hike.

Safe haven assets like gold and silver tend to thrive when interest rates retreat, and rising rates can sometimes stifle demand for these non-interest-bearing assets.

Earlier this week, officials confirmed that Iran and Oman were working on a deal that could fully reopen the Strait of Hormuz. U.S. President Donald Trump said on Wednesday that a deal could be announced at some point this week, although no deal was publicized as of market close on Friday. Crude oil futures fell on Friday despite the lack of major news, retreating by 0.27% to bring the total weekly retreat to more than 3.3%. 

Next week, rate hike speculation and news on the Strait of Hormuz are primed to dominate headlines in the precious metals market.

Where interest rate expectations are concerned, the key figures should come out of the July Consumer Price Index (CPI) scheduled for release next Wednesday. This data could change the landscape for how the Federal Reserve votes at its upcoming meeting in September. An especially high inflation reading could motivate the FOMC to raise rates sooner rather than later. Conversely, a surprising backstep in consumer prices may push rate hike expectations at the September meeting even lower.

Traders will also be closely following developments in the Middle East, particularly with regard to the Strait of Hormuz. Crude oil futures are still up by nearly 20% from before the US-Israeli strikes on Iran prompted Tehran to close the vital Strait of Hormuz. Maritime analytics monitors find that commercial traffic in the Strait of Hormuz, through which an estimated 20% of the world’s annual crude oil supply flows, remains severely restricted. News of a full reopening could drive crude oil prices closer to their pre-war prices, and this could have a downstream effect on safe haven demand.

Like in previous weeks, the upcoming trading week is likely to boil down to short-term fluctuations due to major news in the Middle East and trickier, longer-term demand shifts in response to the evolving interest rate outlook.