Catalytic hydrogenation of carbon monoxide and carbon dioxide is studied over copper/zirconia and silver promoted copper/zirconia catalysts. Vibrational spectroscopy is used to obtain information on the reaction mechanism leading to methanol by in situ identification of the adsorbed species and intermediates in the pressure range from 3 to 25 bar. The water-gas shift reaction producing CO2 from CO and vice versa plays a crucial role in the mechanism. This reaction is shown to proceed in a basic variant via surface carbonates in the presence of surface hydroxyl groups. Surface bound formaldehyde and methylate are the pivotal intermediates on the route to methanol whereas formate is not a direct precursor of the desired methanol product. The addition of silver as a promoter results in enhanced selectivities and productivities for methanol. The most prominent feature of the spectroscopic measurements on the silver promoted copper/zirconia catalyst is the high surface concentration of surface formaldehyde which is formed on or stabilised by the silver component.