x
Central banks returned to significant gold buying in August, adding a net 15 tonnes to global reserves after a pause in July, according to the World Gold Council. This level of buying is consistent with the trend observed between March and June, suggesting a sustained interest in gold despite its recent price rally. The National Bank of Kazakhstan was the largest buyer for the month, adding 8 tonnes for its sixth consecutive month of purchases. Other central banks with reported increases of one tonne or more included Bulgaria, Turkey, the People's Bank of China, Uzbekistan, the Czech National Bank, and the Bank of Ghana. The general trend indicates that central banks remain keen on increasing their gold exposure, with only Russia and Bank Indonesia reporting sales of 3 tonnes and 2 tonnes respectively.
The ongoing interest is further evidenced by forward-looking statements from major institutions. The National Bank of Poland, the largest buyer of 2025, confirmed it would raise its target gold share within international reserves from 20% to 30%, signalling a resumption of active gold purchases when market conditions are favourable. Meanwhile, the Bulgarian National Bank made its largest monthly increase since 1997, which is significant as Bulgaria prepares to join the eurozone in 2026. The Central Reserve Bank of El Salvador also made a small purchase, viewing the acquisition as a long-term prudential balance in its international reserves. This continued accumulation, despite the high gold price, shows that many central banks still view gold as a crucial part of their reserve assets. Source
Major stock indexes experienced a mixed day, though the S&P 500 and Nasdaq Composite both reached new record closing highs, propelled by optimism from an artificial intelligence chip-supply deal between AMD and OpenAI. AMD's stock surged over 23%, boosting other chip companies and the Philadelphia Semiconductor Index. However, the Dow Jones Industrial Average finished slightly lower as the ongoing U.S. federal government shutdown postponed the release of key economic data, though market analysts believe the Federal Reserve may be more accommodative with interest rates as a result. The market also showed a "momentum bias," largely shrugging off the shutdown in anticipation of a good third-quarter earnings season.
In currency and commodity markets, the dollar strengthened against the euro and yen, which weakened amid fiscal and political uncertainties in France and Japan. The euro fell after the new French Prime Minister's short-lived cabinet resigned, while the yen declined following the election of a conservative leader for Japan's ruling party, leading to expectations of more fiscal stimulus and lower short-dated bond yields. Meanwhile, Bitcoin hit a new record high, surpassing $125,000, as investors sought alternative assets, and gold also surged to an all-time high above $3,900 an ounce, both supported by the prevailing global political and economic uncertainty. Oil prices also saw gains after OPEC+'s planned production increase for November was more modest than anticipated. Source
Gold prices experienced a strong upward trajectory during the week, driven primarily by the ongoing United States government shutdown, which encouraged investors to sell dollars and buy hard assets. The price of spot gold climbed from its opening level of $3,768.19 per ounce to nearly touch $3,900, hitting a weekly high of $3,894 per ounce before consolidating in the mid-$3,880s by the close. Analysts from both Wall Street and Main Street expressed high bullish sentiment in the latest Kitco News Weekly Gold Survey, with 92% of experts and 74% of retail traders predicting a further rise in prices, suggesting gold's recent seven-week rally is likely to continue.
Market sentiment is buoyed by geopolitical crises, a weakening U.S. dollar, and the general mismanagement of fiat currency, with some analysts noting that support for gold appears solid around $3,800 and the target of $4,000 "does not seem so far away." Experts also pointed out that the government shutdown is minimally impacting the Federal Reserve's ability to gauge the economy, while the shutdown itself acts as a reminder that the U.S. may not be as safe an investment as perceived, driving capital into metals. Looking ahead, the absence of major U.S. government data next week places focus on the Federal Reserve's September meeting minutes and various officials' speeches, though many believe the broader market focus will soon shift to corporate earnings. Source
After achieving its best monthly gain in decades, gold prices are currently consolidating below $3,900 an ounce as some investors take profits, but the metal's fundamental support remains exceptionally strong. The enduring factors that have propelled gold's price up over 40% this year, marking its best annual performance since 1979, continue to intensify, with the U.S. government shutdown now adding a new bullish driver. While the immediate economic impact is minimal, the longer the political impasse lasts—potentially leading to a loss of $7 billion to $15 billion in economic activity per week—the greater the damage will be to America’s global credibility, which has already been weakened by trade tensions.
The political instability has intensified a global "debasement trade," as identified by JPMorgan, where investors are losing confidence in fiat currencies due to concerns about persistent government deficits, long-term inflation, and debt debasement. This trend, previously dominated by central banks diversifying reserves into gold over the past three years, has now entered a new phase with retail investors entering the market. Evidence of this surge in retail interest is seen in the record investment demand for gold-backed exchange-traded funds, such as the SPDR Gold Shares (GLD), which saw its gold holdings increase by 35.2 tonnes in September—a record month for the fund. Source
Gold was the best-performing precious metal this week, rising 2.60%, with its gains attributed to the U.S. government shutdown and a significant increase in investment in bullion-backed ETFs, which grew by 111 tons last month. Strong demand for gold-related assets was evident with Zijin Gold's IPO being 240 times oversubscribed, and Westgold Resources projecting substantial annual output growth to over 470,000 ounces by fiscal year 2028. Conversely, palladium was the worst performer, falling 1.65%, amidst a delay in a U.S. trade action probe concerning subsidized Russian imports. Operational challenges also presented weaknesses for some companies, with St. Barbara Gold yet to secure an adequate proposal for its Atlantic assets and Centerra management believing its stock is undervalued due to market misunderstanding of its strategy and past issues.
A key opportunity highlighted is Bank of America’s view that silver's recent outperformance is a catch-up trade to gold, which is typical in extended gold bull markets, with the gold-to-silver ratio dropping significantly from its April 2025 peak. This suggests a potential for silver to continue outperforming gold, with one analyst calculating a historical average implied silver price of $54 per ounce. Newmont also announced a significant leadership transition, with Natascha Viljoen set to succeed CEO Tom Palmer on January 1, 2026. However, threats include unexpected corporate shakeups, such as the immediate departure of Barrick Gold CEO Mark Bristow, and rising initial capital costs for projects like Dundee Precious Metals' Loma Larga, which, despite being offset by higher commodity price assumptions, face permitting hurdles. The sustained, smooth nature of the gold rally also signals a potential vulnerability, as historical upswings typically involve sharp pullbacks that have been absent recently. Source
JPMorgan analysts have formally labelled the strong investment demand for alternative assets like gold and Bitcoin as the “debasement trade,” noting that retail investors are increasingly motivated by a Fear of Missing Out (FOMO). This demand is driven by multiple factors, including heightened geopolitical and policy uncertainty, concerns about long-term inflation, worries over “debt debasement” stemming from persistent government deficits, doubts about the Federal Reserve's independence, and a broader move away from the U.S. dollar, especially in emerging markets. Gold and Bitcoin have seen significant gains this year, with gold up over 40% and Bitcoin up 28.6%, though analysts also suggest watching silver, which is up over 60% this year and attracts a more diverse retail base due to its lower price point. The surge in retail interest has been particularly strong since the Federal Reserve restarted its easing cycle in late August.
While retail investors are only recently accelerating their participation, this rally is noted to be three years old, having been initially fuelled by central banks diversifying reserves into gold since 2022, shortly after the U.S. dollar was used as a financial weapon against Russia. This central bank activity has seen global gold reserves increase by 1,000 tonnes over three years, pushing gold to become the second-largest reserve asset globally, surpassing the euro. Despite gold prices nearly tripling, analysts believe the rally is still in its early stages as retail demand has only just begun to accelerate. Even with September being a record month for SPDR Gold Shares (GLD) inflows, overall ETF gold holdings and speculative interest remain below the all-time highs seen in previous years, suggesting there is still significant value in the market as central banks are expected to continue their dollar diversification into gold. Source
The rally across gold, silver, and platinum is continuing to drive prices to multi-year or all-time highs, with analysts at Heraeus noting that the Fear of Missing Out (FOMO) is currently stronger than any profit-taking, even as gold remains technically overbought and pushes toward $4,000 per ounce. Gold's momentum is supported by several factors: ongoing high government deficit spending, which is considered more significant than the U.S. government shutdown, and uncertainty surrounding the Federal Reserve's future interest rate path, with the futures market expecting two more rate cuts this year. Gold ETF positioning also strengthened in September, reaching its highest level since September 2022, although a correction remains a possibility. Silver is outperforming gold, up 64% year-to-date and reaching 14-year highs, benefiting from the same macroeconomic tailwinds as gold but with the added structural support of rising industrial demand, particularly as it approaches its all-time high of $50 per ounce.
Silver ETF inflows continue to drive its momentum, with aggregate holdings still having headroom before reaching their 2021 peak, though a sharp outflow could trigger a price correction, especially as technical indicators suggest an overbought market; however, U.S. physical bullion demand for silver coins has shown signs of softening, contracting sharply by over 50% year-on-year. Platinum is also surging, breaking above $1,600 per ounce to a 12-year high, and reaching a record high in Japanese yen terms, raising the risk of demand suppression in Japan's jewelry and investment segments due to the weaker yen. The strong prices for platinum and palladium have significantly boosted the South African rand basket price for 4E metals, allowing most producers to achieve healthy margins on an all-in sustaining cost basis. Source
Gold and silver prices are moving higher in midday U.S. trading, with gold hitting a new record high of $3,983.00, and silver reaching a 14-year high of $48.61, as steady safe-haven demand continues to drive the precious metals rally. The market is being buoyed by the prospect of U.S. interest rate cuts expected later this year and the persistent uncertainty surrounding a prolonged U.S. federal government shutdown, which shows no signs of an immediate resolution. The rally has been substantial, with gold prices up approximately 50% this year, and total holdings in gold-backed exchange-traded funds recently expanding at the fastest rate in over three years, indicating significant contribution from private investors.
The gold market has strong overall technical momentum, with the bulls' immediate target being a close above the solid psychological resistance level of $4,000.00. Similarly, silver futures also maintain a strong near-term technical advantage, with the next major objective for bulls being to close prices above $50.00. Key outside market factors include a higher U.S. dollar index, crude oil trading around $61.75 a barrel, and the 10-year U.S. Treasury note yielding 4.16%. Platinum futures have also been swept up in the move, hitting a 13-year high of $1,650.20, reinforcing the broad-based safe-haven demand across the precious metals complex. Source
Bank of America's (BofA) technical analyst Paul Ciana, who had previously highlighted the $4,000 gold price target, is now sounding a note of caution as the precious metal approaches that level after a nearly 50% rally this year. Ciana warns that a variety of technical signals across multiple time-frames suggest "uptrend exhaustion" as gold nears $4,000 per ounce, indicating that much of its near-term upside potential has been achieved and that the market appears slightly overbought. He suggests that a consolidation or correction could follow in the fourth quarter and advises investors to consider risk management measures, such as raising stop losses, hedging, or reducing long exposure, while contrarian traders might consider buying put options lasting four to six weeks.
Ciana’s analysis notes that the current bull market, while smaller than the rallies of the 1970s and 2000s, is showing maturity and vulnerability to a mid-cycle correction, similar to those seen in previous bullish phases. He highlights several technical warning signs: gold has closed higher for seven consecutive weeks, a streak that historically resulted in lower prices four weeks later in all 11 previous instances; the metal is trading about 21% above its 200-day moving average, a level where price peaks are common; and it is roughly 70% above its 200-week moving average, a condition seen only three times previously. Ciana identifies initial support for a potential correction at $3,790, with risks extending as low as $3,525. Source
Silver prices are surging, up nearly 67% this year and trading solidly above $48 an ounce, significantly outpacing gold’s 50% year-to-date gain and driving the gold-to-silver ratio to its lowest level in nearly a year. Despite this strong momentum attracting investor interest, British precious metals research firm Metals Focus is cautioning that the rally toward $50 an ounce could negatively impact industrial consumption of the metal, potentially introducing market volatility. The firm highlights the solar power sector—one of the largest sources of silver demand—as a key area to watch, noting that high prices could force manufacturers to accelerate "thrifting," which is the process of reducing the amount of silver used per unit.
Metals Focus projects that silver consumption by the photovoltaic (PV) solar sector will decline by 1% this year from 2024's record high, with evolving technology and potential substitution expected to reduce silver usage per watt by 15–20% this year. Despite this anticipated drop in industrial demand and persistent economic uncertainty, the firm does not expect the overall bullish trend in silver to be impacted, as the market is still projected to face a large supply deficit of approximately 187.6 million ounces, which would be the third-largest on record. Metals Focus managing director Philip Newman expects continued investment demand to support prices and foresees that the silver market will continue to see "decent deficits" for the foreseeable future, noting that the sheer growth of sectors like solar power will continue to drive demand. Source
In this week’s Live from the Vault, Andrew Maguire unpacks how Beijing’s physical gold buying and the Shanghai Gold Exchange’s Basel III-compliant vaults are forcing a US Treasury gold price revaluation.
The precious metals expert explains how silver’s critical mineral status and limited global supply are fuelling physical stockpiling, pushing the market higher and reinforcing individual investors’ move from cash into physical metals.
Disclaimer: These articles are provided for informational purposes only. They are not offered or intended to be used as legal, tax, investment, financial, or any other advice.
Featured Image - Source: Unsplash
