Gold saw a major rebound on October 22, rising to $4,159 per ounce after two days of sell-offs that included significant outflows from gold-backed ETFs.
The October 22 rally has sent the price of gold up nearly 60% this year, though it has recently stabilized near $4,000.
Gold’s volatility embodies a change in global markets – according to research firms and economists – a change driven by fears of weak global growth, exploding trade, and inflation. Research by the World Gold Council suggests that this year’s rally was led by investors around the world seeking safety amid geopolitical tensions, a weak dollar and fears of a stock market correction. Central bank purchases have also helped, both in stimulating demand and also in communicating a positive narrative about gold.
The People’s Bank of China was the most prominent gold buyer, adding about 39 tons during 11 consecutive months of purchases. But China is not the only legal authority collecting bullion. Poland, Azerbaijan and Kazakhstan are the biggest buyers of gold as of August, according to the latest available data from the World Gold Council. Central banks in Türkiye, the Czech Republic and Cambodia are also notable buyers. The list of net sellers is sparse. Uzbekistan, Singapore and Russia are the biggest sellers of gold so far this year.
China has a strong hand in gold prices, says Tony Nash, CEO of AI forecasting firm Complete Intelligence and co-founder of the geopolitical blog Cloak and Dagger. His research shows that the People’s Bank of China is buying defensively as Beijing braces for possible currency devaluation amid slowing growth and trade tensions. The 90-day tariff truce between the US and China ends on November 10. “Very few people admit it, but the gold markets are a kind of proxy for the intensity of the US-China trade dispute,” Nash explains.
He believes that the price of gold will return to normal if the anger between Beijing and Washington subsides. “As we move closer to a more acceptable situation in US-China trade relations, we will see a normalization of gold prices,” he predicts.
Vladimir Signorelli, founder of Bretton Woods Research, points to conflict in the Middle East and Ukraine as focal points for gold. It is also believed that mitigating tariff shocks could help stabilize prices. In late October, JPMorgan Chase analysts predicted that gold prices would continue to rise, reaching an average of $5,055 per ounce by the end of 2026.
