Gold prices extended their sharp slide Monday, with spot bullion trading around $4,332 per ounce in early New York hours after touching a two-month low of $4,314 on Friday. The yellow metal has erased nearly all of its 2026 gains in a brutal week of selling triggered by a blowout U.S. jobs report and surging Treasury yields.
The weekly drop of roughly 4% marks the worst performance for gold since early spring, and comes despite an underlying uptrend that has carried prices $951 higher than a year ago. Investors are now bracing for a critical stretch of data and policy decisions that could determine whether the safe-haven metal stabilizes or breaks lower toward the $4,000 psychological floor.
Jobs Shock Reprices Fed Path
Friday's nonfarm payrolls report was the spark for the selloff. The Bureau of Labor Statistics reported May payrolls grew by 172,000 — more than double the 85,000 consensus estimate — signaling that the U.S. labor market remains far more resilient than economists had penciled in.
The figure landed with particular force in rates markets. According to CME FedWatch data, the implied probability of a December rate hike surged to 72%, up from just 45% a week earlier. Higher interest rates are typically bearish for gold, which pays no yield and competes directly with interest-bearing assets like Treasuries.
"Gold may next test the psychologically important $4,000 line for critical support if markets receive hotter-than-expected CPI prints this week, or a decidedly hawkish FOMC next week," one precious metals analyst warned in a note cited by USAGOLD.
FOMC and CPI on Deck
Traders are looking ahead to two pivotal events. The Federal Open Market Committee meets June 16-17, with markets pricing roughly 99.3% odds that the federal funds target range will remain at 3.50%-3.75%. The bigger question is the tone of the post-meeting statement and Chair Jerome Powell's press conference — and whether the updated dot plot tilts hawkish given the strong labor data.
The latest CPI report has also weighed on sentiment. April 2026 inflation came in at 3.8% year-over-year, the highest reading since 2023, driven in part by a 17.9% surge in energy costs amid renewed geopolitical oil shocks in the Middle East. A hot May print this week could push gold through near-term technical support.
Bigger Picture Still Bullish
Despite the pullback, longer-term forecasts remain constructive. J.P. Morgan Global Research continues to project gold prices climbing toward $5,000 per ounce by the fourth quarter of 2026, with $6,000 a possibility over a longer horizon. Persistent inflation, central bank buying, and elevated geopolitical risk remain the core pillars of the bull case.
For now, however, the path of least resistance points lower. With the dollar firming and real yields rising, traders are treating gold as a momentum trade rather than a hedge — and the next few sessions of macro data may determine whether bulls reclaim the $4,400 handle or cede ground to the $4,000 zone.
Sources: USAGOLD Daily Precious Metals Market Report (June 8, 2026); BullionVault Gold News; Fortune "Current price of gold: June 8, 2026"; Yahoo Finance Personal Finance; J.P. Morgan Global Research commodities outlook.