Silver falls to just above $75 on profit taking

Today’s headlines

What’s happening: Silver prices edged lower this morning as investors digested the latest economic reports.

What happened: Spot silver has been under pressure after hitting an all-time high of $117.69 per ounce on January 26.

Meanwhile, the US reported a significant easing in its annualised inflation rate.

Why it matters: Silver prices had hit a record high in late January, driven by safe-haven demand amidst geopolitical tensions and inflation concerns as well as industrial demand from solar and electric vehicle companies.

Silver prices fell sharply on Friday, amid a wider market selloff, including weakness in tech stocks.

Strong US labour market data added to the pressure on precious metals. The US Labor Department reported a decline in initial jobless claims by 5,000 to 227,000 in the first week of February. Although the nonfarm payroll (NFP) report showed a decline in the unemployment rate, jobs grew by 130,000 in January, well above market estimates of 55,000.

On Friday, the US reported a meaningful slowdown in its annual inflation rate. Inflation slowed from 2.7% rate in December to 2.4% in January, hitting an eight-month low. Prices rose 0.2% in January, slower than in December, aided by declining gas prices, housing-related costs and a modest increase in food prices.

The easing inflation rate did not change speculations around the Federal Reserve’s moves. Investors widely expect the Fed to keep interest rates unchanged in March and April, while anticipating two rate cuts of 25 bps each later this year.

Spot silver was down 3.11% to $75.0230 per ounce this morning. Meanwhile, spot gold fell 1.33% to $4,975.84.

What to watch: Investors await the Eurozone’s industrial production report (1400 UAE Time) and Canada’s housing starts (1715 UAE Time) today. Eurozone’s industrial production, which grew 0.7% in November, is expected to decline by -1.5% in December.

The markets today

Japan’s stocks in focus today as traders digest GDP growth data

Context: Equity markets in Japan rose this morning, after closing lower on Friday.

Details: Japanese stocks fell on Friday on profit taking, after hitting another record high on Thursday. The Nikkei 225 has been climbing after Prime Minister Sanae Takaichi’s victory in the general elections, which gave her a solid mandate to pursue higher spending and tax cuts.

Data released this morning showed the Japanese economy growing an annualised pace of 0.2% in the fourth quarter of 2025. Although the figure missed market estimates of 1.6%, it was much better than the 2.6% contraction in the previous quarter.

The rebound in the Japanese economy was supported by a recovery in business spending, a better contribution from net trade and continued government expenditure.

Japan’s gross fixed capital formation rose 0.2% in the fourth quarter, recovering from the 0.2% decline reported in the previous quarter.

The Nikkei 225 rose 0.17% to 57,038.92 this morning.

What to watch: Investors await the release of tertiary industry index from Japan tomorrow. The index had declined by 0.2% to 105.50 points in November and is expected to decline by another 0.2% in December.

Markets will also watch Japan’s balance of trade data on Wednesday. The country’s trade surplus had narrowed to ¥105.7 billion in December from ¥120.3 billion in the year-ago month. Japan is expected to report a trade deficit of ¥2,142.1 billion in January.

Other Markets: US trading indices closed mostly higher on Friday, with the Dow Jones index and S&P 500 up by 0.10% and 0.05%, respectively, while the Nasdaq 100 closed down 0.22%.

The news shaping the markets

US Secretary of State Marco Rubio questioned Russia’s intention to sign the White House brokered peace deal and stop the war with Ukraine. The news sent the USD/RUB pair lower in forex trading this morning.

Canada’s car registrations fell to 127,248 units in December, from 148,726 in the previous month, which exerted pressure on the CAD/USD forex pair.

Russia’s annual inflation rate rose to 6% in January, easing from an over two-year low of 5.6% in the previous month, which sent the country’s stock market significantly higher this morning.

Saudi Arabia’s annual inflation rate fell to 1.8% in January, from 2.1% in the previous month. The figure came in below expectations of 2.0% and was the lowest reading since September 2024, which exerted pressure on the USD/SAR forex pair.

Singapore’s trade surplus widened to S$12,53 billion in January, from S$4.50 billion in the previous month, lending support to the SGD/USD pair in forex trading this morning.

What else to watch today

Turkey’s central government budget balance (1200 UAE Time), India’s unemployment rate (1430 UAE Time), US Fed Bowman Speech (1725 UAE Time) and Canada’s manufacturing sales (1730 UAE Time).