Weekly Metals Market Recap: Interest Rates Steady, Iran Tensions Flare, Silver Stalls Below $60/ozt

 

Weekly Market Recap: Interest Rates Steady, Iran Tensions Flare, Silver Stalls Below $60/ozt

(July 31st, 2026) – Welcome to your weekly gold and silver market recap. Prices for both metals retreated to end the trading week. The spot price of gold shed more than $50 per troy ounce on Friday, closing at around $51.82. Silver prices also pulled back, slipping by more than $1.20/ozt and settling at approximately $57.87 per troy ounce. The price action favored gold, driving the gold-silver ratio higher on the day.

Throughout the week, both gold and silver experienced a bit of volatility but ultimately ended the week down. Both speculation surrounding the federal interest rate outlook and fresh hostilities in the Middle East impacted markets this week.

On the interest rate front, the Federal Open Market Committee (FOMC) voted to keep rates steady at 3.5-3.75%. Three voters dissented, arguing instead for a rate hike. According to the committee’s statement, inflation remained elevated in part because of the ongoing war in Iran.

Inflation remains elevated relative to the Committee’s 2 percent goal, in part reflecting supply shocks that have driven price increases in certain sectors, including energy. The Committee will deliver price stability.

Market expectations for rate hikes this year remain high. CME FedWatch projects a 72.1% probability that the FOMC will vote to raise interest rates at its next meeting in September. By December, the overall probability of a rate hike jumps to 91.2%, with two total hikes before the end of 2026 holding the highest likelihood at 42.1%.

The bigger picture for precious metals: rate hike expectations can weigh on prices by stifling demand for safe haven assets. Historically, safe haven assets like gold have thrived in environments where interest rates are going down, and the present price outlook could be mitigating some of the stronger gold-favorable signals coming from the rest of the market.

Tensions continued to flare in the Middle East throughout the trading week. According to a CBS report citing multiple sources, the U.S. and Israeli militaries plan to conduct a major bombing strike against Iran’s energy infrastructure. U.S. President Donald Trump has reportedly not yet approved the final plan. The plan comes after a week of strikes between the United States and Iran. The conflict has driven crude oil prices higher, with crude oil futures jumping nearly 25% in the past month.

The status of the Strait of Hormuz, a vital waterway through which an estimated 25% of the world’s annual supply of crude oil flows, is a source of disagreement between authorities in the United States and Iran. U.S. Central Command argues that the waterway remains open, but statements from Iranian military leaders have suggested that the Strait of Hormuz is closed to commercial traffic.

While uncertainty can drive demand for safe haven assets like gold and silver, the conflict in Iran has driven speculation that the Federal Reserve could keep interest rates elevated. This has exerted downward pressure on the price of gold, and silver has followed suit for much of this quarter as gold prices declined.

Next week, traders are looking ahead to a July U.S. employment report slated for release on August 7. This report could impact the interest rate outlook. June’s jobs report came in weaker than expected. The median forecast expects 85,000 jobs added after June’s weaker-than-expected 57,000. Another weak labor reading could motivate the Federal Reserve to hold off on raising rates, as hiking rates could risk further damage to the jobs market by raising the cost of borrowing for businesses. This could be a bullish sign for gold, though the long-term likelihood remains high for a rate hike before the end of 2026.

Like in previous weeks, major news coming out of the Middle East could be a source of short-term volatility in the precious metals market. The reported US-Israeli plan to strike energy infrastructure in Iran will likely be an impactful piece of news to watch out for. Any development along the Strait of Hormuz could also impact oil futures and, by proxy, the inflation and interest rate outlook.