Silver Surges Past $61 as Weak Official Jobs Data and Fed's Warsh Signal Policy Pivot

Silver breaks $60 after shock US jobs miss and dovish Fed signals, with geopolitical tensions adding support. Gold also above $4,000.

A dramatic week for labor market readings has propelled silver decisively above the $60 threshold, with the white metal touching $61.38 an ounce after official US job creation came in far below expectations. The rally marks a stark reversal from recent weakness, as investors recalibrate their rate outlook in the wake of a deteriorating employment picture.

The US economy added just 57,000 jobs in June, the softest print in four months and roughly half the level analysts had forecast. The leisure and hospitality sector was the biggest drag, shedding 61,000 positions even as the World Cup was expected to draw tourists. The unemployment rate unexpectedly slipped to 4.2%, though the decline reflected a drop in labor force participation rather than robust hiring. Wage growth, meanwhile, ticked up to 3.5% year-over-year, adding a complicating factor for policymakers.

The official data followed Wednesday’s ADP report, which had already set the stage for disappointment. ADP counted only 98,000 new private-sector jobs in June, well below the 118,000 consensus and down from May’s 122,000. That release sent the dollar lower — the dollar index slipped 0.3% — and lifted spot silver to around $59.88 initially. The weaker greenback makes the dollar-denominated metal cheaper for overseas buyers, and the subsequent official figures provided a second powerful tailwind.

Fed Chairman Kevin Warsh, who took office on May 22, gave the rally further momentum during his appearance at the ECB Forum in Sintra on July 1. Warsh acknowledged that inflation risks have “moderated materially” and signaled a shift away from the Fed’s traditional forward guidance framework. Although he reaffirmed the 2% inflation target, markets interpreted his tone as less hawkish than anticipated. Before the Sintra speech, the probability of a September rate hike stood at 67%; by Thursday that had fallen below 50%. For the July meeting, no hike is currently priced in.

Geopolitical uncertainty is adding a further bid to safe-haven assets. The market is closely watching US-Iran peace talks in Qatar, with direct negotiations viewed as unlikely, heightening concerns about Middle Eastern stability. Silver is not the only beneficiary of the flight to safety: gold has climbed back above $4,000 an ounce, while the yield on the 10-year Treasury note eased to 4.49%.

Thursday’s surge to $61.38 broke a multi-month downtrend for silver. Despite the strong year-over-year gain of roughly 66%, the monthly chart still shows a nearly 16% decline, underlining the metal’s extreme sensitivity to macro signals. If upcoming US economic data continue to disappoint, the market may fully price out a September rate hike, providing further support for the precious metal. With the official non-farm payrolls now in the rearview mirror, attention shifts to whether silver can consolidate above the psychologically important $60 level.