Gold price advances 2%: planning and project economics notes for mine teams
Reviewed by Tom Sullivan
First reported on MINING.com
30 Second Briefing
Gold prices jumped 2.3% on Monday to about $5,070/oz, recovering roughly half of last month’s 12% single-day crash and leaving bullion still 14% higher year-to-date as traders await US January jobs data and clearer signals on Federal Reserve rate cuts. Central bank demand remains strong, with the People’s Bank of China extending purchases for a 15th consecutive month amid broader reserve diversification away from US assets, backed by houses such as Deutsche Bank and Goldman Sachs. Silver climbed 7% to above $83/oz after a >35% January slump, with retail dip buying driving sizeable ETF inflows and markedly higher price volatility.
Technical Brief
- Spot gold moved intraday from the $4,700–$4,900 consolidation band to $5,070/oz.
- The Jan. 29 selloff was a 12% single‑day move, worst since the 1980s.
- Pepperstone’s Ahmad Assiri frames stability above $5,000 as key to a “sustainable advance”.
- Chinese central bank has now logged 15 consecutive months of net gold reserve purchases.
- Deutsche Bank and Goldman Sachs both maintain constructive forecasts based on reserve diversification and policy risk.
- Silver’s January drawdown exceeded 35%, versus gold’s smaller percentage crash over the same event.
- Heraeus’ Marc Loeffert characterises silver as entering a “markedly higher‑volatility regime” with ETF‑driven rebounds.
Our Take
Gold-linked pieces make up a notable slice of the 949 Mining stories in our database, and episodes with double‑digit single‑day moves like the 12% 29 January drop are relatively rare, signalling stress points that often coincide with short‑term funding or hedging decisions for producers.
The 15‑month gold purchase streak by China’s central bank, combined with a 14% year‑to‑date gain, tends to underpin longer‑term price assumptions in project finance models, which can support marginal project approvals even when spot is volatile around US macro data.
Silver’s >35% January drawdown followed by a 7% rebound fits a pattern in our coverage where silver shows higher beta than gold; this typically leads polymetallic mine operators to revisit by‑product credit assumptions and, in some cases, adjust mine plans towards gold‑rich zones when silver underperforms.
Prepared by collating external sources, AI-assisted tools, and Geomechanics.io’s proprietary mining database, then reviewed for technical accuracy & edited by our geotechnical team.
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