Published: Aug 08, 2026 - 7:23 AM (Kitco News) - Gold investors have spent much of 2026 confronting a frustrating paradox: the geopolitical and fiscal backdrop has arguably never looked more supportive for a safe-haven asset, yet gold has struggled in recent months as rising real interest rate expectations have dramatically increased the opportunity cost of holding a non-yielding metal. However, the important question for gold investors is no longer whether real yields are high; they unquestionably are. The question is whether they can move materially higher from here. For a growing number of analysts, the answer is: no. This week BCA Research argued that “the worst of real rates’ headwind to gold is likely behind us,” with Chief Commodities Strategist Roukaya Ibrahim noting that investors do not need Federal Reserve rate cuts to ignite another rally. They simply need real yields and the U.S. dollar to stop rising. That distinction is critical. Gold has already absorbed an extraordinary monetary-policy repricing. At the beginning of the year, markets anticipated one or two rate cuts. Today, investors are contemplating one or two hikes. Jefferies estimates that 10-year TIPS yields have risen to around 2.41% from 1.94% at the start of 2026. That abrupt reversal helped drive gold roughly 25% below its peak. Yet gold continues to defend the psychologically important $4,000-an-ounce level. The World Gold Council noted that gold finished July virtually unchanged at $4,027, even as rising yields remained a headwind. More importantly, European gold ETFs attracted inflows despite real Bund yields sitting at 15-year highs. In other words, gold has survived nearly everything the opportunity-cost argument could throw at it. Jefferies reaches a similar conclusion from history. Gold's performance following previous real-rate shocks depended less on the absolute level of yields than on whether the upward pressure subsequently subsided. The firm argues that much of today's repricing has already occurred and that easing real-rate pressure could allow gold and mining equities to recover. Meanwhile, the structural bullish forces haven't disappeared. Central banks continue accumulating gold, de-dollarization remains an important theme, fiscal concerns haven't gone away, and geopolitical uncertainty remains elevated. BCA expects official-sector demand to provide a floor even if central-bank purchases no longer generate the explosive upside they once did. Even inflation could ultimately become supportive, although not for the simplistic reason that gold is an inflation hedge. The World Gold Council argues that inflation becomes much more meaningful when it pushes above 4%, particularly if accompanied by falling real rates, dollar weakness or increasing recession risks. The bullish argument, therefore, doesn't require a collapsing economy, emergency Fed easing or another inflation crisis. It merely requires the forces that pushed gold down to stop getting worse. After one of the most aggressive opportunity-cost shocks gold has faced in years, that threshold may finally have been reached. And if real yields have indeed peaked, gold's biggest headwind could soon become its most important tailwind. Source： https://www.kitco.com/news/article/2026-08-07/golds-biggest-headwind-may-finally-be-peaking

August 7, 2026 Gold ETFs saw a marked turnaround in July: after two months of outflows, these physically backed, exchange-traded funds began attracting capital once again. According to data from the World Gold Council (WGC), global holdings rose by 23.5 tonnes (just under US$3 billion). This development signals a return of investor interest and coincided with the end of the gold price’s four-month losing streak; the price has since risen above the US$4,200 mark once again. Return of tactical buyers and a cautious North America The WGC believes that market participants used the previously lower gold prices, close to US$4,000 per ounce, as an entry point to re-enter the market and diversify their portfolios. This led to a rise of around 2 per cent in the gold price in July. Whilst inflows were broadly supported globally, the recovery in North America was extremely subdued, with an increase of just 0.3 tonnes (US$71 million). This modest growth was not sufficient to significantly reduce the year-to-date deficit. North America therefore remains the only region to record net outflows so far this year. Europe dominates in July, Asia remains the strongest driver for the year The global build-up in holdings was led by European investors. Gold ETFs listed in Europe recorded inflows of 17.3 tonnes (US$2 billion) in July, marking the second-strongest month of the year for this region. Demand was particularly strong in the UK and Switzerland, which together have attracted around US$5 billion since the start of the year. The WGC recognises a cyclical pattern here: as earlier in the year, European investors deliberately rebuilt their positions following periods of significant market weakness. In Asia, although demand slowed in July, it remained on a growth trajectory with an increase of 4.8 tonnes (US$616 million). China led the regional gains, driven by a search for ‘safe havens’ following sharp falls in the stock market and falling local yields. Whilst India recorded moderate inflows, Japanese ETFs suffered outflows due to rising local yields. Overall, the market is showing a shift in momentum: since the start of the year, global net inflows into gold ETFs have totalled US$11 billion (39 tonnes). Despite a strong July in Europe, Asian funds remain the biggest driver of ETF holdings in the year to date. Source： https://goldinvest.de/en/gold-etfs-europe-leads-turnaround-following-two-month-slump

SMM August 11 news: The ADP and non-farm payrolls data in the US fell significantly short of expectations, and the US labour market weakened, causing the market to lower its expectations for US Fed interest rate hikes. After an earlier deep correction in the precious metals market, a certain amount of short positions had accumulated; when the market turned a corner, this triggered concentrated short covering. Meanwhile, gold ETFs saw fund inflows, and investment buying was active on China’s futures market. This round of gains was driven more by financial attributes and derivatives-related funds, while the physical side failed to provide a simultaneous boost. In addition, central banks around the world continued to allocate to gold assets, and the PBOC increased its gold holdings for the 21st consecutive month, building medium and long-term bottom support for gold prices. A confluence of factors pushed precious metals futures prices higher. As of around 13:27 on August 11, COMEX gold extended gains into a third straight session, up 0.89% at $4,459/oz; the most-traded SHFE gold futures extended gains for another session, up 1.887% to 961.86 yuan/g; COMEX silver extended gains into a third straight session, up 0.39% at $65.525/oz; the most-traded SHFE silver futures extended gains for the sixth straight session, up 3.08% to 16,069 yuan/kg; silver T+D extended gains for the sixth straight session, up 1.98% to 15,860 yuan/kg. In addition, the most-traded platinum futures extended gains for a second session, up 0.59% to 437 yuan/g, and the most-traded palladium futures extended gains for the fifth straight session, up 1.92% to 331.05 yuan/g. Currently, the market is focused on US July CPI data, and uncertainties remain for precious metals. With futures prices continuing to rise, what are institutions’ views on the outlook for precious metals? Spot Market Silver On August 11, the SMM #1 silver ex-factory reference average price in the morning was 16,123.5 yuan/kg, up 4.63% from the previous trading day. The continuous rise in silver prices continued to suppress downstream industrial demand, with buyers mostly adopting a wait-and-see attitude. The price spread narrowed today, traders lowered their offer prices, and some suppliers chose to sell at discounts to move inventory. Morning quotes in Shanghai were mainly concentrated between TD-5 and +5 yuan/kg. Reduced purchases by banking institutions weakened the floor support, and only some acceptance demand led to necessary deals, with the overall market leaning toward parity or a slight discount. In Shenzhen, some nationally standardized supplies were concentrated around slight discounts, with both buyers and sellers remaining cautious. Today, market premiums for the most-traded SHFE 2610 contract were quoted at a discount of 65 to 55 yuan/kg. Overall, precious metals drifted higher today, driven by bullish factors and buying. Spot market, after silver prices rose, selling pressure mounted, and transactions gradually shifted to discounts. Platinum On August 11, the average spot price of platinum was 432 yuan/g, up 0.23% from the previous trading day. Mainstream platinum quotations were at discounts of 3.5 yuan/g to 2.5 yuan/g against the PT2610 contract, with a wide disparity in quotations. Downstream consumption remained relatively weak, dominated by just-in-time procurement. The discount on mainstream quotations was basically flat with yesterday. Due to consecutive futures gains, some unhedged goods were offered at lower prices in the market. Today, overall consumption in the platinum spot market remained sluggish. Voices Regarding the future trend of precious metals, some institutions are more optimistic, while others are more cautious. The views of several institutions are as follows: Chaos Tiancheng Futures believes: Precious metals moved in tandem with US Treasury yields, the US dollar index, and oil prices on Monday, reflecting their gradual pricing in of long-term drivers such as debt credit risk, while the increasing possibility of "stagflation" further supported the market. The long-term driver, US Treasury credit, showed some intensification, as the US debt scale further exceeded $40 trillion last week and the US July deficit rate deteriorated, with the twin worries over debt and deficit driving precious metals higher. This week, accompanied by the re-emergence of the "commodity currency logic," precious metals again showed relative strength, while US Treasuries saw some "selling" – the 10-year Treasury yield climbed back to 4.7%, and precious metals also moved higher in tandem with Treasury yields. From the perspective of capital and fundamental resonance, market positioning sentiment and central bank gold purchases provided bottom support. The underlying logic of global central banks' continuous normalization of gold purchases remained unchanged. The PBOC increased gold holdings for 21 consecutive months, with monthly purchases of about 20 mt, creating sentiment resonance in the market. "Stagflation logic" rose further, boosting precious metals. Last week, US non-farm payrolls data showed negative growth, and the AI narrative still faced negative impacts. Monday's news showed Nvidia collaborating with Wall Street giants to advance an AI infrastructure plan worth $500 billion. This further triggered market interpretation of the AI logic and concerns over debt risks, causing US stocks to decline, and economic expectations decreased compared with earlier periods. The geopolitical situation remained volatile. Iran published a "preliminary plan for the management of the Strait of Hormuz" with very strict conditions, restricting US and Israeli vessels, imposing transport limits on some countries, and possible penalties for rule violations. The rebound in oil prices drove inflation expectations higher, US Treasury yields rebounded, and inflation risks increased. Last week, precious metals saw a sharp rebound in sentiment following a period of significant suppression, with the long-term logic of drifting higher continuing on Monday. Going forward, attention should be paid to USD/JPY exchange rate fluctuations; geopolitical developments and whether this week's US CPI data show breakout momentum to the upside. Relatively speaking, gold’s support is more stable than silver’s, while silver exhibits greater elasticity. Scott Rubner, strategist at Citadel Securities, recommended for the first time in 2026 that investors allocate to structural gold positions, and said the precious metals market is forming “one of the most attractive rally opportunities in months.” Rubner believes that gold and silver are seeing multiple tailwinds at the same time, including a shift in Fed policy expectations, continued central bank gold purchases, quantitative funds remaining in a net short position, bullish signals from the options market, and a possible return of retail funds previously drawn to the AI trading frenzy. In his view, a rare confluence of multiple factors is taking shape, and the precious metals market may enter a new phase of upside. UBS: expects gold prices to rise to $5,000/oz in H1 2027. Gold prices may remain relatively volatile in the near term. Matt Simpson, senior analyst at StoneX, said that improving prospects for peace in the Middle East lowered market inflation expectations, driving gold prices further higher from the weeks-long consolidation range above $4,000. The US Labor Department will release the non-farm payrolls report tonight. Simpson added: “Regardless of the non-farm payrolls data, $4,000 has proven to be a solid support level—I suspect the bulls are waiting for a pullback to seize the opportunity and push gold back to $4,600. The non-farm payrolls data may bring some short-term fluctuations, but the price action has already signaled the direction, and gold appears to want to move higher.” World Gold Council: In July, positive momentum factors offset negative risk factors, leaving gold prices flat for the month. Looking ahead, a second wave of high inflation similar to the late 1970s cannot be ruled out. However, this does not by itself mean gold will rally significantly; it depends on real interest rates, the US dollar, growth expectations, Asian investor demand, and how central banks respond. Kelvin Wong, senior market analyst at OANDA, said: “The link between gold and oil prices remains, because oil prices have a huge impact on inflationary pressures in the global economy. If we can see a clear roadmap for further de-escalation in the (Middle East) situation, gold prices could continue to rise.” (Jinshi Data APP) A CITIC Securities research report said that since the beginning of this year, gold prices shot up and then quickly fell, but the bank believes gold is still in a major bull market, with reasons including the accelerating expansion of the US fiscal deficit, geopolitical rifts under deglobalization that are hard to heal, and continued gold purchases by global central banks providing a floor. Therefore, we believe that the current gold price decline is only a temporary correction within a bull market. The current pullback magnitude has approached historical extremes, and the area around $4,000/oz is likely the bottom of this cycle. Looking ahead, the impact of the Strait of Hormuz situation on gold prices is expected to shift from suppressing to boosting, the US Fed's monetary policy may be more optimistic than market expectations, and combined with the surge in US military spending pushing up the deficit, gold prices are expected to return to an upward channel within the year. Everbright Futures' outlook for August: Gold's short-term trend depends on the evolution of the US-Iran situation. If the conflict persists or spills over and expands, market sentiment may weaken again, and under liquidity risk expectations, gold prices may continue to underperform; however, if there is a substantive breakthrough in negotiations, gold prices may stabilize in the short term and stage a rebound-repair trend, at which point if both domestic and external financial markets show a synchronous recovery, this can be further confirmed. However, it can be expected that, supported by central banks' rigid buying and allocation demand, even if there is another pullback, the room for decline will be relatively limited. Additionally, at the Jackson Hole global central bank symposium at the end of August, Warsh may outline the medium-term policy framework, and before that, the US CPI data on the 12th will be a key validation indicator. Overall, gold may present a bottom-solidifying and sentiment-repair phase, and we are cautiously optimistic. The core risk lies in the US-Iran conflict again causing oil prices to climb above $90/oz, US inflation data rebounding significantly beyond expectations, and the rising probability of a September rate hike continuing to suppress market sentiment. However, judging from the performance of financial markets outside China and oil prices, neither supports a full-scale escalation of the US-Iran conflict. A Reuters survey shows that after gold prices pulled back sharply from the record high in January, analysts cut their gold price forecasts for the first time since the end of 2023, but most still expect central bank buying and concerns about fiscal sustainability to provide support. In the survey of 29 analysts and traders conducted over the past three weeks, the median forecast for gold prices in 2026 is $4,509 per ounce. This figure is lower than $4,916 three months ago and marks the first downward revision in 11 quarters. The average forecast price for 2027 is $4,610, compared with $5,100 in the previous survey. Gold prices hit an all-time high of $5,595 per ounce in January, but in the second quarter, as the Iran war intensified energy inflation and pushed up rate hike expectations, prices suffered a sharp pullback, marking the worst quarterly performance since 2013. Since the outbreak of the war, spot gold has fallen about 22%. (Jin10 Data APP) ING analysts Warren Patterson and Ewa Manthey noted that gold prices rose on Monday, as a sharp drop in oil prices eased inflation concerns and pressured the US dollar and Treasury yields. Oil prices slumped sharply on Monday, easing inflation worries and the prospect of further monetary tightening. The move came on the heels of a pause in US-Iran hostilities. The decline in oil also weighed on the US dollar and US Treasury yields, improving the outlook for non-yielding assets ahead of this week’s Fed meeting. Markets are now focused on the Fed and upcoming US inflation data for further cues on the rate outlook. If yields remain suppressed, gold should continue to find support near current levels. However, any hawkish surprise from the Fed could cap further upside room in the near term. Commerzbank cut its year-end gold price forecast to $4,500 per troy ounce. It now sees platinum at $2,000 per troy ounce at the end of the year, down from an earlier forecast of $2,100. Citi said its base case shows India’s gold imports will stay sluggish in the third quarter, even though the third quarter is historically a seasonal stockpiling peak. The reasons are ample scrap supply, cautious consumer sentiment, and local price discounts that are curbing fresh import demand. Nonetheless, Citi kept its 0–3 month short-term gold target at $4,500. The bank said this target assumes an easing of tensions in the Strait of Hormuz and a shift to a less hawkish Fed; numerous short-term risks could still cause gold to test lower again, including a major re-escalation, AI-driven de-risking, and a persistently hawkish Fed. Analysts at ANZ Research said in a note that physical gold demand and central bank purchases are underpinning the gold market. They added that while prices face short-term headwinds from Fed tightening expectations and a strong US dollar, gold investment positioning looks thin after months of outflows from exchange-traded funds, suggesting further downside could be limited. High interest rates typically weigh on non-yielding assets like gold. (Zhith Finance) Goldman Sachs said that despite pressure from tighter Fed expectations, central bank buying is expected to provide a floor for gold. Demand remains strong; the bank estimates central banks bought 81 mt in May, with a three-month average of 67 mt per month, well above the pre-2022 average of 17 mt. “We believe the trend of central banks adding to gold holdings will persist for years as they diversify reserves to hedge against geopolitical and financial risks,” Goldman analysts said. The bank forecasts monthly central bank purchases will average 50 mt this year and 40 mt next year. (Jinshi Data APP) Kim Soojin, an analyst at MUFG, said: “Recent price action suggests markets are placing more weight on the likelihood that US interest rates will stay high for longer than on gold’s traditional safe-haven demand.”"This leaves gold vulnerable to pressure unless geopolitical risks further translate into a broad deterioration in financial market sentiment.” (Jin10 Data APP) Asset manager Fidelity International said it plans to rebuild the gold positions it reduced earlier this year at an appropriate time in the future, believing that gold's long-term drivers remain robust. Ian Samson, multi-asset portfolio manager at Fidelity International, recently said, “We plan to rebuild our gold position; the question is only about timing.” He said that from January to February this year he reduced his gold allocation to neutral, at a time when gold's multi-year bull market suddenly ended. Samson expects the gold market to re-enter a bull market at some point in 2027. Only if “governments re-embrace fiscal discipline and central banks truly commit to pushing inflation back down” would the case for returning to a bull market be undermined, “but I don’t think we are in that world right now.” Samson also noted that continued central bank gold purchases — a key driver of the previous bull market — will continue to support gold prices. A research report from Guoxin Securities shows: After a deep pullback in H1, gold prices near $4,000 are gradually showing signs of a bottom, awaiting only event catalysts to drive a rally. It suggests building positions in tranches on dips near $4,000 and avoiding chasing highs. Core allocation logic: First, valuations are at historical lows, offering a notable margin of safety. After the deep pullback in H1, valuations of gold mining companies have dropped significantly from the start of the year to low levels, providing high odds. Going forward, apart from a valuation repair rally, there is potential to also capture the price elasticity from rising gold prices. Second, earnings elasticity is a significant advantage. Gold stocks act as an amplifier of gold prices — mining costs are rigid, so higher gold prices translate directly into profit growth, and earnings elasticity far exceeds the gold price increase itself. A research report from Huayuan Securities points out: Over the medium term, the market's core trading logic has anchored on the pricing chain of “inflation stickiness and resilience exceeding expectations → prolonged period of high Fed rates → repeated flare-ups of rate hike expectations within the year.” Gold’s pricing anchor remains dominated by real US Treasury yields and the US dollar index, and the overall market is likely to continue consolidating on a subdued note. Currently, Middle East ceasefire negotiations are mired in repeated wrangling, with the two sides holding significant differences on core demands such as withdrawal arrangements, nuclear facility verification mechanisms, and control over the Strait of Hormuz shipping lane as well as transit fee rules. The recurrent nature of geopolitical conflicts continues to unsettle global crude oil supply expectations, and upside risks to energy prices could further entrench inflation stickiness, in turn supporting the Fed’s tightening stance. Meanwhile, the concurrent rise in the US dollar index and US Treasury yields is creating a double drag, and with gold’s safe-haven attribute temporarily giving way to interest-rate pricing logic, upside room for gold prices is likely to remain constrained. Key events to watch over the next two weeks include: 1) developments in the Middle East conflict and the navigation situation in the Strait of Hormuz; 2) the Fed's interest rate decision to be released on July 30; 3) the US PCE for June to be released on July 30. In the long term, gold's bullish logic has not weakened but rather strengthened amid shifts in global macro and geopolitical landscapes. 1) Constraints from US fiscal deficits, debt expansion, rising trade protectionism, and intensifying major-power rivalry are undermining the stability of the dollar's credit anchor, driving a reallocation of global reserve assets toward diversification. Gold is gradually evolving into a key asset for hedging sovereign credit risks, geopolitical fragmentation risks, and risks from the restructuring of the global monetary system. 2) Continued gold purchases by global central banks are still providing solid bottom support for gold prices, and the PBOC's sustained purchases further validate the official sector's long-term allocation demand. 3) The late stage of the US economic cycle faces multiple constraints from high interest rates, credit contraction, and slowing growth. Looking ahead, whether the Fed cuts interest rates due to economic slowdown or is forced to maintain high rates for longer due to sticky inflation, gold holds strong long-term allocation value: the former supports a decline in real interest rates, while the latter reinforces demand for safe-haven and credit-risk hedging. Overall, gold remains in a favorable window over the medium and long term, with its price center expected to continue moving higher amid the reshaping of global macro and geopolitical landscapes. Recommended reading:

This week, precious metals first declined then rose. ADP employment data significantly missed expectations, causing rate hike expectations to pull back rapidly, and silver prices rebounded strongly to hit a new high in nearly two months. In the short term, focus on the revision of rate hike expectations by the non-farm payrolls data. In the medium and long term, US debt risks and the turning of the interest rate cycle will continue to support precious metals.

SMM, August 6: Metal Markets: As of the midday close, base metals on the domestic market were almost all up. SHFE copper rose 0.4%, SHFE aluminum rose 0.23%. SHFE lead edged up. SHFE zinc rose 1.49%. SHFE tin rose 0.26%. SHFE nickel fell 2.1%. In addition, the most-traded casting aluminum futures contract edged down, while the most-traded alumina contract rose 1.36%. The most-traded lithium carbonate contract fell 1.23%. The most-traded silicon metal contract rose 0.12%. The most-traded polysilicon futures contract fell 0.65%. Ferrous metals were mostly in the green. Iron ore rose 2%, rebar rose 0.67%, and HRC rose 0.53%. Stainless steel fell 1.51%. For coking coal and coke: the most-traded coking coal contract rose 0.74%, and the most-traded coke contract rose 1.99%. On the overseas base metals market, as of 11:42, LME metals were almost all down. LME copper fell 0.36%, LME aluminum rose 0.17%, LME lead fell 0.16%, LME zinc fell 0.37%. LME tin fell 1.58%. LME nickel fell 1.9%. In precious metals, as of 11:42, COMEX gold rose 0.44%, while COMEX silver fell 0.05%. On the domestic precious metals market: SHFE gold rose 3.72%, and the most-traded SHFE silver contract rose 3.19%. Additionally, as of the midday close, the most-traded platinum futures contract rose 1.05%, and the most-traded palladium futures contract rose 1.4%. As of the midday close, the most-traded container shipping futures (Europe route) contract fell 0.63% to 1,651 points. As of 11:42 on August 6, selected futures midday prices: Spot and Fundamentals Copper: Today, spot #1 copper cathode in Guangdong against the front-month contract: high-quality copper was quoted at 90 yuan/mt, down 20 yuan/mt from the previous trading day; standard-quality copper was at a premium of 10 yuan/mt, down 20 yuan/mt; and SX-EW copper was at a discount of 50 yuan/mt, down 20 yuan/mt. The average price of #1 copper cathode in Guangdong was 107,900 yuan/mt, up 910 yuan/mt from the previous trading day, and that of SX-EW copper was 107,820 yuan/mt, up 930 yuan/mt. In the spot market: Guangdong inventory increased again, mainly due to increased arrivals and weakening consumption... Macro Front China: [PBOC’s open market operations saw a net drain of 269.5 billion yuan today] The PBOC conducted 1 billion yuan of 7-day reverse repo operations at an interest rate of 1.40%, unchanged from the previous operation. Today, 270.5 billion yuan of reverse repos matured. [China Gold Association: In H1 2026, increase in domestic gold ETF holdings fell 66.17% YoY] Data from the China Gold Association showed that the increase in domestic gold ETF holdings in H1 2026 was 28.677 mt, down 66.17% from H1 2025. By the end of June 2026, the open interest of gold ETFs in China stood at 276.529 mt. China increased its gold holdings by 40.12 mt in H1 2026, bringing its gold reserves to 2,346.45 mt by month-end June, ranking fifth globally. The country had added to its gold reserves for 20 consecutive months, Nov 2024-Jun 2026. (Jin10 Data APP) On August 6, the central parity rate of the RMB in the interbank foreign exchange market was 6.7895 yuan per US dollar. US Dollar: As of 11:42, the US dollar index edged up 0.03% to 99.72. Cooling US ADP employment data contrasted with elevated ISM services costs, raising stagflation concerns. US ADP employment data missed expectations! The US ADP private payrolls increased by only 44,000 in July, the lowest this year, making Friday's non-farm payrolls data critical. US ADP private-sector employment rose by just 44,000 in July, a new low for the year and below expectations. The goods-producing sector was under pressure, signaling a cooling labour market. However, job-stayers' wages saw robust YoY growth of 7%, indicating persistent structural tightness. The market is focused on Friday's non-farm payrolls data; if it follows the same trend, it would confirm steady employment, supporting the Fed's continued focus on combating inflation. The US ISM Services PMI continued expanding in July, showing demand-side resilience but intensifying stagflation risks. The US ISM services index rose to 54.1 in July, a 0.1-point uptick from June but below the expected 54.5. The new orders index surpassed expectations to hit 57.2, and the prices paid index exceeded forecasts to reach 70.3, while the employment index fell short of expectations, dropping to 47.4 and into contraction territory. Rising costs alongside contracting employment presented stagflationary characteristics. The US Treasury kept its quarterly debt issuance size unchanged, with $40 trillion in debt pressure looming. The latest Treasury refunding statement maintained current auction sizes for coupon-bearing securities but changed the description for future issuance from "increases" to "adjustments," preserving flexibility for future policy shifts. The borrowing estimate for the current quarter was raised to $739 billion, with the total federal debt about to surpass $40 trillion. The Treasury continues to rely on short-term bills to bridge the gap, making financing costs more sensitive to interest rates. The market fears that delaying adjustments could trigger a larger shock from long-term debt issuance later. (From Wall Street Horizon APP) Data: Today will see the release of Switzerland's July seasonally adjusted unemployment rate, the Eurozone's June retail sales MoM, US July Challenger job cuts, US initial jobless claims for the week ending August 1, US July Global Supply Chain Pressure Index, and US June wholesale sales MoM, among other data. To watch: Fed Governor Lisa Cook will speak on the economic outlook; 2027 FOMC voter and San Francisco Fed President Daly will deliver remarks. Crude Oil: As of 11:42, oil prices in both markets edged down, with US crude down 0.28% and Brent crude down 0.13%. The market is focusing on the progress of talks between Iran and Oman. Iranian Deputy Foreign Minister Gharibabadi said in an interview on August 5 that the agreement between Iran and Oman on merchant ship passage through the Strait of Hormuz is close to being finalised. According to local news from the Iranian side on the 5th, both the southern route through Omani territorial waters and the northern route within Iranian territorial waters will be closed, establishing a new passage model in the Strait of Hormuz that differs from the past 60 years. Additionally, Gharibabadi denied that Iran is in negotiations with the US, but stated that Iran has received messages from the US side, and said the US has expressed readiness to resume fulfilling commitments under the previously signed memorandum of understanding. (CCTV) On August 5 local time, US President Trump said in a speech at an event in Las Vegas that recent oil prices have fallen and stabilised to some extent, "We may have to let it go up again," but he "hopes it won't come to that." Trump did not elaborate on the meaning of this statement. An analysis by the Associated Press pointed out that although Trump has repeatedly assured that the war with Iran is about to end, oil prices typically rise anew with the onset of conflicts between the two sides. (CCTV International) Spot Market Overview: ► ► ► ► ► ► ► ► ►

SMM, August 5: Expectations for Middle East geopolitics are shifting toward easing, oil prices have pulled back sharply for two consecutive trading days, and market concerns about inflation have cooled. Expectations for a US Fed interest rate hike in September have pulled back, with multiple positive factors resonating to drive precious metals futures and stocks to strengthen together. In the futures market: As of around 17:12 on August 5, COMEX gold was up 1.7% at $4,223.1/oz; SHFE gold main contract was up 3.1% at 910.4 yuan/g; COMEX silver was up 2.53% at $61.77/oz; SHFE silver main contract was up 7.08% at 15,105 yuan/kg; silver T+D was up 5.8% at 14,988 yuan/kg. Platinum main contract futures were up 9.18% at 441.15 yuan/g; palladium main contract futures were up 8.51% at 329.65 yuan/g. In the stock market: As of market close on August 5, the precious metals sector was up 7.87%. In individual stocks: Sengda Resources and Sichuan Gold hit the daily limit up, while Xiaocheng Technology, Chifeng Gold, Zhongjin Gold, Xingye Silver&Tin, and Shanjin International were among the top gainers. News [South Korea's Central Bank Plans to Purchase Domestically Refined Gold Bars for the First Time in 13 Years] According to South Korean media reports, the Bank of Korea said on Monday that it will cooperate with LS MnM, the Korea Exchange (KRX), and the Korea Securities Depository (KSD) to purchase domestically produced gold for the first time in 13 years through over-the-counter transactions, as heightened geopolitical risks have increased the need to diversify foreign exchange reserves. LS MnM and Korea Zinc produce about 40 to 45 mt of gold annually as a by-product of smelting, of which about 10% is exported. The central bank stated that if relevant enterprises apply, it will consider using the trading and settlement system of the KRX and the storage facilities being prepared by the KSD to purchase some of the gold intended for export. The central bank said it will arrange bulk transactions after prior consultations on price and quantity to limit the impact on domestic gold prices, and that the new channel should reduce foreign exchange risks, since previous overseas purchases were all paid in US dollars. Additionally, the central bank also stated that it purchased a small amount of gold ETFs in Q2. Separately, it was reported that as of July, its gold holdings remained unchanged at 104.4 mt, while South Korea's foreign exchange reserves at the end of June stood at $427.36 billion, including gold reserves worth $4.79 billion. [World Gold Council: Gold Investment Demand Expected to Remain Positive] The World Gold Council report noted that in the remainder of 2026, investment demand is expected to be the main driver of gold demand growth, and will be increasingly supported by over-the-counter trading activities and Asian investment demand. Central banks will remain key gold buyers. High gold prices will continue to suppress gold jewelry demand, but the response of gold ore production and recycled gold supply is expected to be relatively mild. Gold investment demand is expected to remain positive for the rest of 2026. OTC activity and Asian investment demand are expected to play a larger role, while Western gold ETF flows may continue to be sensitive to US Treasury real yields, Fed monetary policy expectations, and the US dollar. Although consumer spending has remained relatively resilient, high gold prices will continue to suppress gold jewelry demand; technology-related gold demand is expected to further benefit from AI investment, but downside risks are accumulating. (Jinshi Data) [Zijin Mining: Terminates Acquisition of United Gold, Plans to Subscribe for 9.2% Equity] Zijin Mining announced on the Hong Kong Stock Exchange that on January 26, 2026, its controlled subsidiary Zijin Gold International signed an Arrangement Agreement with United Gold, under which Zijin Gold International would acquire all outstanding common shares of United Gold for a cash price of C$44 per share, with a total consideration of approximately C$5.5 billion (approximately $4 billion). However, after comprehensive evaluation, both parties believed that certain closing conditions precedent could not be fully satisfied or waived by the deadline stipulated in the acquisition agreement (which had been extended to July 29, 2026) or within a reasonable period thereafter. The parties agreed to terminate the acquisition, and neither party is required to pay a termination fee or any other fees to the other. Meanwhile, the parties separately entered into a Share Subscription Agreement, under which Zijin Gold International intends to subscribe for 12.8 million common shares (representing approximately 9.2% of the enlarged share capital post-issuance) placed by United Gold at a cash price of C$32.55 per share, with a total subscription amount of C$416.6 million, equivalent to approximately $295 million. [Chifeng Gold: Expects H1 2026 Net Profit to Increase by 54%-61% YoY] Chifeng Gold disclosed an earnings forecast on the evening of July 14, expecting its H1 2026 net profit attributable to shareholders to be 1.7 billion yuan to 1.78 billion yuan, up 54%-61% YoY. [Zhaojin Gold: Expects H1 2026 Net Profit to Increase by 347.48%-436.98% YoY] Zhaojin Gold disclosed an earnings forecast on the evening of July 14, expecting its H1 2026 net profit attributable to shareholders to be 200 million yuan to 240 million yuan, up 347.48%-436.98% YoY; recurring net profit is expected to be 80 million yuan to 116 million yuan, up 490.44%-756.14% YoY. [Shandong Humon Smelting: Expects H1 2026 Net Profit to Increase by 81.06%-122.36% YoY] Shandong Humon Smelting disclosed an earnings forecast on the evening of July 14, expecting its H1 2026 net profit attributable to shareholders to be 570 million yuan to 700 million yuan, up 81.06%-122.36% YoY; recurring net profit is expected to be 272 million yuan to 402 million yuan, down 2.03%-33.73% YoY. [Western Gold: H1 2026 Net Profit Expected to Rise 280.16%-333.39% YoY] Western Gold disclosed on the evening of July 13 that it expects its H1 2026 net profit attributable to the parent company to be 500 million to 570 million yuan, up 280.16%-333.39% YoY; and adjusted net profit to be 490 million to 580 million yuan, up 172.96%-223.09% YoY. [Zhongjin Gold: H1 2026 Net Profit Expected at 4.1-4.6 Billion Yuan, up 52.15%-70.7% YoY] Zhongjin Gold disclosed on the evening of July 13 that it expects its H1 2026 net profit attributable to the parent company to be 4.1 billion to 4.6 billion yuan, up 52.15%-70.7% YoY; and adjusted net profit to be 4.05 billion to 4.55 billion yuan, up 36.96%-53.87% YoY. Spot Market Silver On August 5, the morning ex-factory reference average price of SMM #1 silver was 14,556 yuan/kg, up 2.38% from the previous trading day. In the spot market, downstream demand remained sluggish this month, with limited new orders overall. The strengthening silver price further weakened downstream purchase willingness; market transactions mainly relied on support from banking institutions, with deals concentrated around parity, and traders were reluctant to quote. Morning quotations in Shanghai were mostly at parity to a premium of up to 10 yuan/kg against TD; in Shenzhen, some national standard goods were quoted around parity. Although low-priced goods existed, they did not significantly disturb spot trade. Today, the market quoted a discount of 60 to 50 yuan/kg against the most-traded SHFE contract 2610. Overall, expectations for a Strait of Hormuz agreement heated up, inflation concerns eased briefly, and precious metals recovered slightly. In the spot market, the rise in silver prices further suppressed demand, with orders remaining sluggish and trading staying thin. Voices Regarding the future trend of precious metals, some institutions' views are as follows: CITIC Securities research report stated that this year gold prices shot up and then fell rapidly, but we believe gold is still in a major bull market, with reasons including the accelerating expansion of the US fiscal deficit, irreconcilable geopolitical rifts under deglobalization, and continued gold purchases by global central banks providing a floor. Therefore, we think this round of decline in gold prices is merely a temporary correction within the bull market. The current pullback has approached historical extremes, and the $4,000/oz area is highly likely to be the bottom zone for this round. Looking ahead, the impact of the Strait of Hormuz situation on gold prices is expected to shift from a drag to a boost, the Fed's monetary policy may be more optimistic than market expectations, and coupled with surging US military spending driving up the deficit, gold prices are expected to return to an uptrend within the year. Deutsche Bank precious metals strategist Hsueh Michael stated that the "explosive rally phase" for gold prices that began in August 2024 is not yet over, and maintains the forecast of gold at $4,600/oz in Q4 2026. This assessment rests on a triple framework of fair value models, statistical tests, and official demand data, discounting the significant downside risk implied by commodity price ratios. (Zhitong Finance) A research report from CICC Wealth Futures shows: oil prices pulled back, gold rebounded, and currently, the yen's disruption causing moves in the US dollar index is a new disturbance factor, which is expected to have a relatively limited impact on gold price trends. The biggest pressure on gold currently still comes from oil prices. CICC Wealth Futures believes that if oil prices are not excessively strong, the probability of gold maintaining a fluctuating trend or drifting higher is relatively high. Everbright Futures' outlook for August suggests that the short-term gold price trend depends on the evolving US-Iran situation. If the conflict persists or its spillover expands, market sentiment may weaken again, and under liquidity risk expectations, gold prices may continue to underperform. However, if a substantive breakthrough in negotiations occurs, gold prices could stabilize in the short term and undergo a recovery and rebound. At that point, if domestic and overseas financial markets show a synchronized recovery, it can be further confirmed. Nevertheless, it can be expected that with support from rigid central bank purchases and allocation demand, even if a pullback occurs again, the downside should be relatively limited. Additionally, at the Jackson Hole Economic Symposium at the end of August, Warsh may outline a medium-term policy framework. Before that, the US CPI data on the 12th will be a key verification indicator. Overall, gold is likely in a stage of bottom consolidation and sentiment repair, and we hold a cautiously optimistic view. The core risk is that the US-Iran conflict once again pushes oil prices above $90/oz, a significant rebound in US inflation data far exceeding expectations, and the evolving probability of a September rate hike continuing to suppress market sentiment. However, judging from the performance of overseas financial markets and oil prices, a full-scale escalation of the US-Iran conflict is largely unsupported. A Reuters survey showed that after gold prices pulled back significantly from their record highs in January, analysts cut their gold price forecasts for the first time since the end of 2023, though most still expect support from central bank buying and concerns over fiscal sustainability. In the survey of 29 analysts and traders conducted over the past three weeks, the median forecast for gold prices in 2026 was $4,509/oz. That figure is down from $4,916 three months ago and marks the first downgrade in 11 quarters. The average forecast for 2027 is $4,610, compared to a forecast of $5,100 in the previous poll. Gold prices hit an all-time high of $5,595/oz in January, but suffered a sharp pullback in Q2 as the Iran war exacerbated energy inflation and boosted rate hike expectations, marking the worst quarterly performance since 2013. Since the outbreak of the war, spot gold has fallen about 22%. (Jinshi Data APP) Analysts Warren Patterson and Ewa Manthey from ING noted that gold prices rose on Monday, as a sharp decline in oil prices eased inflation concerns and pressured the US dollar and US bond yields. The large drop in oil prices on Monday alleviated inflation worries and the prospect of further monetary tightening. The move came after a pause in US-Iran hostilities. Lower oil prices also weighed on the US dollar and bond yields, improving the outlook for non-yielding assets ahead of this week’s Fed meeting. Markets are now focused on the Fed and the upcoming US inflation data for further guidance on the interest rate outlook. If yields remain subdued, gold prices should continue to be supported near current levels. However, any hawkish surprise from the Fed could limit further upside room in the near term. Commerzbank has lowered its year-end gold price forecast to $4,500 per troy ounce, and now expects platinum to reach $2,000 per troy ounce by year-end, down from a previous forecast of $2,100. Citi said its base case shows that India’s gold imports will remain subdued in the third quarter, despite historically being a seasonal peak for stockpiling. The reasons include ample scrap supply, cautious consumer sentiment and local price discounts curbing demand for fresh imports. However, Citi maintains its short-term gold price target of $4,500 for 0–3 months. This target, the bank said, assumes an easing of tensions in the Strait of Hormuz and a less hawkish turn by the Fed; in the short term there remain many risks that could push gold prices lower again, including a major re-escalation, AI-driven de-risking, and a persistently hawkish stance by the Fed. UBS gold strategist Joni Teves remains optimistic on the medium to long-term outlook for gold. She noted in her comments that gold prices have been rising since the start of this week, with gold stocks in mainland China and Hong Kong surging around 20% over three days – a positive signal. “We believe confidence in gold is starting to improve and continue to expect that prices will rebound from current levels by year-end,” she said. UBS’s global team remains upbeat on gold’s medium-term outlook and forecasts prices will reach $4,675 per ounce by end-2026 and $4,800 per ounce by end-2027. She indicated that the key events to watch going forward are the Fed’s policy tone at the FOMC meeting at the end of July and further developments in the Middle East. (Jinshi Data APP) Analysts at ANZ Research said in a report that physical demand for the metal and central bank purchases are supporting the gold market. These analysts added that while gold prices face short-term headwinds from the US Fed's tightening expectations and a strong US dollar, after months of outflows from exchange-traded funds, gold investment positions look thin, suggesting limited room for further declines. A high-interest-rate environment typically weighs on non-yielding assets like gold. (Zhitong Finance) Goldman Sachs stated that despite pressure from the US Fed's tightening expectations, central bank purchases are expected to provide a floor for gold. Demand remains robust, with the bank estimating that central banks bought 81 mt of gold in May and the three-month average of monthly purchases at 67 mt, far above the pre-2022 average of 17 mt. Goldman Sachs analysts said, "We believe the trend of central banks increasing their gold holdings will continue for many years as they diversify reserves to hedge geopolitical and financial risks." The bank forecasts average monthly purchases will be 50 mt this year and 40 mt next year. (Jin10 Data) Kim Soojin, analyst at Mitsubishi UFJ Financial Group, said, "Recent price action suggests that the market is placing more weight on the likelihood that US interest rates will stay high for longer rather than on gold's traditional safe-haven demand. This leaves gold vulnerable to pressure unless geopolitical risks further translate into a broad deterioration in financial market sentiment." (Jin10 Data) Fidelity International, an asset manager, said it plans to add to its gold positions again at an appropriate time after reducing them earlier this year, believing gold's long-term momentum remains strong. Ian Samson, multi-asset portfolio manager at Fidelity International, said recently, "We plan to add to our gold positions again; the question is just the timing." He said he reduced his gold allocation to a neutral level from January to February this year, when gold's multi-year bull market abruptly ended. Samson expects the gold market to re-enter a bull market sometime in 2027. The logic for a return to a bull market would only be undermined if "governments re-embrace fiscal discipline and central banks are truly committed to bringing inflation back down," "but I don't think we're in that world right now." Samson also noted that continued central bank gold purchases, a key driver of the previous bull market, will continue to support gold prices. A research report from Guoxin Securities shows that after a deep correction in H1, gold prices near $4,000 are gradually showing signs of bottoming out, with further upside only awaiting event catalysts. It recommends building positions in batches near $4,000 on dips and avoiding chasing rallies. Key allocation logic: First, valuations are at historically low levels, providing a notable margin of safety. After a deep pullback in H1, current valuations of gold mining companies have retreated sharply from the beginning of the year to low levels, offering high odds. Going forward, aside from a valuation repair rally, they are expected to further benefit from the price elasticity driven by rising gold prices. Second, earnings elasticity advantage is significant. Gold stocks act as an "amplifier" for gold prices—the cost of gold mining is rigid, so rising gold prices directly translate into profit growth, making earnings elasticity far exceed the gold price increase itself. A research report from Huayuan Securities points out: from a medium-term perspective, the market’s core trading logic has anchored on the pricing chain of "inflation stickiness and resilience exceeding expectations → extended period of high rates by the US Fed → repeated intensification of rate hike expectations within the year," and gold's price center remains dominated by US real bond yields and the US dollar index, with the overall market likely to consolidate on a subdued note. Ceasefire consultations in the Middle East are currently mired in back-and-forth maneuvering, with the two sides significantly diverging on core demands such as troop withdrawal arrangements, nuclear facility inspection mechanisms, and control rights and toll rules for navigation in the Strait of Hormuz. The recurring geopolitical conflicts continue to disrupt global crude oil supply expectations, and the upside risk of energy prices may further entrench inflation stickiness, in turn supporting the US Fed's tightening policy stance. Meanwhile, the simultaneous rise in the US dollar index and US bond yields is creating a dual suppression effect; coupled with gold's safe-haven attributes temporarily yielding to interest rate pricing logic, the upside room for gold prices may continue to be constrained. Key events to watch over the next two weeks include: 1) developments in the Middle East conflict and navigation conditions in the Strait of Hormuz; 2) the US Fed’s interest rate decision to be announced on July 30; 3) the US June PCE to be released on July 30. In the long term, gold’s bullish logic has not weakened but has been further strengthened amid changes in the global macro and geopolitical landscape. 1) The constraints of US fiscal deficits, debt expansion, rising trade protectionism, and intensifying major-country competition are weakening the stability of the US dollar credit anchor, driving a reallocation of global reserve assets toward diversification. Gold is gradually evolving into an important asset for hedging sovereign credit risks, geopolitical fragmentation risks, and risks of restructuring the global monetary system. 2) Continued gold purchases by global central banks still provide solid bottom support for gold prices, and the PBOC’s continued increase in holdings further confirms the official sector’s long-term allocation demand. 3) The late-cycle US economy faces multiple constraints of high interest rates, credit contraction, and a growth slowdown. In the future, whether the US Fed cuts interest rates due to an economic slowdown or is forced to maintain higher rates for longer due to sticky inflation, gold possesses strong long-term allocation value: the former is favorable for declining real interest rates, while the latter strengthens demand for safe-haven and credit-risk protection. Overall, gold remains in a favorable window in the medium and long term, and its price center is expected to continue shifting upward amid the reshaping of the global macro and geopolitical landscape. Recommended Reading:

The central bank has added gold exposure through ETFs and is preparing to buy domestically produced bullion for the first time since 2013.

August 4, 2026 The world's central banks acquired a net 288.9 tonnes of gold in the second quarter of 2026 – the highest figure ever recorded for a second quarter. What makes this remarkable is the timing: the buying took place during a quarter in which the gold price fell by around 16 per cent. Anyone reading the World Gold Council's figures closely, however, will find a second and considerably more awkward story. The "Gold Demand Trends" report published by the World Gold Council (WGC) on 30 July delivers what may be the most important message of the summer for precious metals investors. While private investors exited gold ETFs during the second quarter and jewellery demand buckled under high prices, official institutions bought with rare conviction. At a net 288.9 tonnes, purchases were roughly 62 per cent above the year-earlier figure of 177.9 tonnes. The contrast with price action could hardly be sharper. The second quarter was gold's weakest since 2013; from the record high of USD 5,598 set in January, the metal has since given up considerable ground and currently trades at around USD 4,050. Central banks evidently did not read that weakness as a warning signal, but as an opportunity. Poland and China Lead the Buyers' List The single largest buyer was the National Bank of Poland with 51 tonnes. Warsaw is thereby continuing a course that brings the country close to its self-imposed target of 700 tonnes of gold reserves. In second place comes the People's Bank of China with 33 tonnes – its largest quarterly addition since late 2023, and a signal that Beijing is accelerating its diversification strategy again after a quieter phase. Behind these two sits a broad field of smaller buyers: Uzbekistan with 16 tonnes, Kazakhstan with 15 tonnes, and the central banks of Jordan and the Czech Republic with around 6 tonnes each. This breadth matters more for interpretation than the headline figure does. A record quarter carried by a single large buyer would be fragile. When demand is spread across numerous institutions from different regions and with different motivations, that points to a structural trend rather than a one-off effect. Russia Stands on the Other Side Not every central bank was buying. The Bank of Russia was the quarter's largest seller at 22 tonnes. The reason is understood to be pressure on the federal budget – here gold simply serves as a liquidity reserve to be drawn upon to plug deficits. Türkiye was also on the selling side once again, though at just 4 tonnes it was markedly more restrained than in the first quarter. These sales are central to any sound interpretation. They show that a portion of official gold movements has nothing to do with strategic conviction and everything to do with fiscal constraints. Anyone reading central bank purchases as a blanket vote of confidence in gold is making it too easy for themselves – and the same applies to anyone reading central bank sales as a blanket loss of faith. The Awkward Part: A Revision That Changes the Half-Year Picture This is where matters become interesting for attentive investors. Alongside the record second-quarter figure, Metals Focus – the World Gold Council's data provider – has sharply revised its estimate for the first quarter downwards: from an original 244 tonnes to just 57 tonnes. That is no cosmetic adjustment but a revision of more than three quarters, and it changes the overall picture considerably. Taken together, central bank demand for the first half of 2026 amounts to roughly 345 tonnes – the weakest half-year figure since 2022. Viewed soberly, then, the record quarter was primarily a catch-up movement following an exceptionally weak start to the year. For assessment purposes this means both statements are true at the same time. The second quarter was a record. The first half-year was weak. Anyone citing only one of the two figures is telling an incomplete story – and in the coverage of recent days, usually only the first has been on offer. What the Statistics Do Not Show A further point deserves attention: a substantial share of central bank purchases is never officially reported. Since 2022 the WGC has consistently identified a high proportion of unreported buying – the gap between estimated total demand and the purchases institutions actually disclose. The reported data underlying the report were, moreover, only captured up to 24 July; later disclosures may lead to further revisions. Investors should draw the right conclusion from this. Central bank demand is real and it is significant – but the published quarterly figures are estimates carrying a considerable margin of error, not exact measurements. An investment decision built on a single quarterly number rests on shifting ground. The Outlook Remains Constructive For all these caveats, the structural direction is unambiguous. The WGC's own survey of reserve managers shows that a large majority of the institutions polled expect global gold reserves to rise over the coming twelve months. Around three quarters also anticipate that their dollar holdings will decline over the next five years. This is where the real substance of the story lies. Central banks do not operate in quarters but in decades. Their gold purchases are not a timing signal for short-term price movements – anyone who bought in April on the basis of central bank demand is sitting on losses today. They are, however, an indicator of how institutional actors assess the long-term role of the US dollar and the case for hedging against geopolitical risk. For the 2026 full year, the World Gold Council expects another strong year of official demand, albeit below the 2025 level. Supply should grow only modestly: high prices and healthy producer margins support mine output, but operational constraints and long project lead times limit the pace. What the gold market did in the first half of 2026 was, above all, to change its buyer. Investors taking a long-term view in this phase will find remarkably patient company in the world's central banks. Source： https://goldinvest.de/en/central-banks-buy-record-amount-of-gold-in-the-very-quarter-prices-fell

[Bearish for Precious Metals] The US Fed held rates but internal divisions intensified, and the hawkish stance remains firm. On July 30, the Fed announced it kept the federal funds rate unchanged at 3.50%-3.75%, marking the fifth consecutive pause in rate hikes. However, the vote was 9:3, with three regional Fed presidents voting for a rate hike—the first time since 2016 that three dissenting votes were cast in unison, highlighting growing hawkish strength within. Fed Chairman Warsh reiterated at the press conference the unwavering commitment to the 2% inflation target and emphasized that if inflation worsens, decisive action will be taken. Market expectations for a September rate hike heated up, extending the duration of high interest rates and continuing to weigh on precious metal valuations. US Treasury yields hit multi-year highs, and elevated real interest rates raised holding costs. Driven by the Fed's hawkish stance and fiscal supply pressures, the 10-year Treasury yield stayed high above 4.6%, while the 30-year yield briefly breached 5.2%, a new high since 2007. The opportunity cost of holding non-interest-bearing precious metals remains elevated, suppressing their appeal for capital. The US dollar index continued to consolidate at highs, while the oil price rebound reinforced the inflation-rate hike linkage. The dollar index consolidated at highs this week in the 101-101.5 range. Although it pulled back slightly after the Fed decision, the overall strength remains intact, directly pressuring precious metals priced in dollars. Meanwhile, escalating Middle East conflicts drove a sharp rebound in international oil prices, with Brent crude returning above $90/barrel. Rising energy prices exacerbated the risk of secondary inflation, in turn reinforcing the logic for the Fed to keep rates high and potentially hike further. Labour market resilience exceeded expectations, supporting prolonged high interest rates. US initial jobless claims for the week ending July 18 fell to 187,000, the lowest since 1969, nearly a 50-year low, showing that the labour market remains quite resilient. Strong employment data reduced the likelihood of Fed rate cuts while providing fundamental support for further rate hikes. The period of real rates staying high was further extended, continuing to suppress the valuation of non-yielding precious metals. [Bullish for Precious Metals] With the US Fed's decision settled, negative factors were fully priced in, driving a sentiment recovery. The outcome of the US Fed maintaining rates unchanged was already fully priced in by the market. Although hawkish signals were sent, no rate hike occurred, leading to a phased release of suppressed bullish sentiment, which drove a slight rebound in precious metals futures. Equity market volatility intensified, with hedging demand rising marginally. This week, US stocks came under increased pullback pressure, with the Nasdaq-100 Index entering a technical correction zone, as tech stocks' earnings expectations and high valuations were under pressure in a high interest rate environment. The rise in equity market volatility drove some funds to increase gold allocations as a risk hedge, providing supplementary support for short-term buying. Global trade frictions fully escalated, with policy uncertainty boosting hedging demand. On July 24, the US officially imposed an additional 10%-12.5% tariff on 60 global trading partners, covering over 99% of total US trade, using Section 301 to replace previous emergency tariffs ruled unconstitutional by the Supreme Court, significantly enhancing legal compliance. Of these, 14 economies were subject to a 10% rate and 46 to a 12.5% rate, with only a few categories such as energy and natural gas exempt. Trade barriers elevated the risk of a global recession, and policy uncertainty drove funds to seek hedging in non-sovereign credit assets like gold, aligning with geopolitical hedging. China's gold ETFs continued to see net inflows, with physical demand forming floor support. China's gold ETFs recorded net inflows for consecutive days, attracting over 300 million yuan in nearly 8 days, reflecting domestic investors' growing demand for gold allocation. Combined with the long-term trend of global central bank gold purchases, physical demand imposed a substantial constraint on the downside room for precious metals. [Macro Summary] This week, the precious metals market saw intense tug-of-war between bulls and bears, overall moving sideways in a narrow range. On one hand, repeated Middle East geopolitical conflicts and escalating global trade frictions provided temporary safe-haven buying support; on the other hand, the strengthened hawkish stance of the US Fed, US Treasury yields and the US dollar index staying high, and oil price rebound pushing up rate hike expectations together exerted sustained pressure. The trending market has not yet clearly emerged, and focus should be on the marginal impacts of changes in September rate hike expectations, the evolution of the Middle East situation, and further escalation of trade frictions.

[Bearish for precious metals] The Fed held rates steady but internal divisions deepened, with the hawkish tone yet to waver. On July 30, the Fed announced it would keep the federal funds rate unchanged at 3.50%–3.75%, marking the fifth consecutive pause in rate hikes. However, the vote was 9 to 3, with three regional Fed presidents supporting a rate hike — the first time since 2016 that three dissenting votes appeared, highlighting the strengthening of the hawkish camp internally. At the press conference, Fed Chairman Warsh reiterated the unwavering 2% inflation target and stressed that decisive action would be taken if inflation conditions worsen. Market expectations for a September rate hike increased, and the extended period of elevated rates continued to weigh on precious metal valuations. US Treasury yields hit multi-year highs, with high real rates raising holding costs. Driven by the Fed's hawkish stance and fiscal supply pressures, the 10-year US Treasury yield remained elevated above 4.6%, while the 30-year US Treasury yield briefly breached 5.2%, its highest since 2007. The opportunity cost of holding precious metals as non-yielding assets remained high, dampening their appeal to investors. The US dollar index continued to consolidate at highs, while the rebound in oil prices reinforced the inflation-rate hike chain. The US dollar index consolidated at highs this week within the 101-101.5 range. Although it pulled back slightly after the Fed decision, its overall strong trend remained intact, directly weighing on dollar-denominated precious metal prices. Meanwhile, escalating Middle East conflicts drove a sharp rebound in international oil prices, with Brent crude back above $90 per barrel. The rise in energy prices heightened the risk of a second-round inflation effect, in turn reinforcing the logic for the Fed to maintain high rates and potentially hike further. Labour market resilience exceeded expectations, supporting prolonged high rates. In the US, initial jobless claims for the week ending July 18 fell to 187,000, the lowest since 1969 and a near 50-year low, demonstrating the labour market's considerable resilience. The strong employment data reduced the likelihood of a Fed rate cut and provided fundamental support for further rate hikes. The period of elevated real rates was further extended, continuing to weigh on the valuation of non-yielding precious metals. [Bullish for precious metals] The Fed decision materialized as expected, and as the bearish news was fully priced in, sentiment recovered. The outcome of the Fed holding rates steady had been fully priced in by the market beforehand. Although the signals were hawkish, no actual rate hike materialized. This allowed previously suppressed bullish sentiment to be released in a phased manner, driving a modest rebound in precious metals futures. Equity market volatility intensified, with hedging demand edging up on the margin. This week, US stock market correction pressure intensified, with the Nasdaq 100 entering a technical correction zone. Tech stocks' earnings expectations and high valuations came under pressure in the high-rate environment. The rise in equity market volatility prompted some funds to increase their allocation to gold as a risk hedging tool, providing additional support to short-term buying. Global trade frictions escalated across the board, and policy uncertainty boosted hedging demand On July 24, the US formally imposed tariffs of 10%–12.5% on 60 global trading partners, covering over 99% of total US trade, replacing the emergency tariffs previously ruled unconstitutional by the Supreme Court with Section 301, significantly enhancing legal compliance. Among them, 14 economies were subject to a 10% rate and 46 to a 12.5% rate, with only energy, natural gas, and a few other categories exempt. Trade barriers raised the risk of a global economic recession, and policy uncertainty drove funds to seek hedges in non-sovereign credit assets such as gold, resonating with geopolitical risk aversion. China’s gold ETFs saw sustained net inflows, and physical demand formed a bottom support China’s gold ETFs saw net capital inflows for multiple consecutive days, attracting over 300 million yuan over the past 8 days, reflecting that domestic investors’ demand for gold allocation continued to rise. Coupled with the long-term trend of global central bank gold purchases, physical demand imposed tangible constraints on the downside room for precious metals. [Macro Summary] This week, the precious metals market saw intense battles between bulls and bears, and overall moved sideways in a narrow range. On the one hand, repeated geopolitical conflicts in the Middle East and escalating global trade frictions provided periodic safe-haven buying support; on the other hand, the Fed’s strengthened hawkish stance, persistently high US Treasury yields and the US dollar index, and the rebound in oil prices that pushed up rate hike expectations collectively exerted sustained pressure. A clear directional trend has yet to emerge. Going forward, close attention should be paid to changes in rate hike expectations for September, the evolution of the Middle East situation, and the marginal impact of further escalation of trade frictions.