Dollar Slips After Weak U.S. Jobs Data; Gold and Silver Rally
The US Dollar Index (DXY) moved lower on Friday after a disappointing U.S. labor report signaled potential softness in the economy. February nonfarm payrolls fell by 92K, sharply missing expectations for a +55K increase, while the unemployment rate edged up to 4.4%. The data pressured the dollar as markets weighed the possibility of a more cautious Federal Reserve outlook.
However, losses in the dollar were somewhat limited as falling global equity markets triggered safe-haven demand for liquidity. Several Federal Reserve officials also reinforced a “higher for longer” stance on interest rates. Officials suggested policy should remain mildly restrictive until inflation clearly moves lower.
Despite the weak jobs data, average hourly earnings rose 0.4% month-on-month and 3.8% year-on-year, indicating wage pressures remain persistent.
Meanwhile, EUR/USD pushed higher, while the Japanese yen weakened to a six-week low against the dollar. Rising oil prices are weighing on Japan’s outlook due to its heavy reliance on imported energy.
Precious metals surged as geopolitical tensions intensified. Gold and silver rallied strongly as investors sought safe-haven assets amid the escalating Middle East conflict involving Iran and concerns that the war could broaden across the region.
Additional support for precious metals came from:
• Expectations of Fed rate cuts later in 2026
• Strong central bank gold buying, particularly from China
• Rising inflation risks driven by surging oil prices
Overall, a mix of weak U.S. economic data, geopolitical tensions, and inflation concerns is pushing investors toward safe-haven assets like gold and silver, while the dollar faces growing pressure in the near term.