Key Points:
- Gold futures trade at $3,032.70, close to the all-time high of $3,065.10 set on Thursday.
- Central bank demand—led by China at 48%—supports prices despite record-low jewellery demand.
Gold futures rose 0.4% to $3,032.70 a troy ounce on Monday, holding close to their record high of $3,065.10 reached last Thursday. The rally comes amid a backdrop of a softer U.S. dollar, heightened central bank buying, and concerns over a potential universal U.S. tariff, according to analysts at Deutsche Bank.
Technical indicators show the precious metal remains well-supported after dipping to a low of $2,999.53, with price action gradually climbing back above the $3,020 threshold. As of the latest session, gold trades at $3,027.64, with strong intraday support anchored above the psychological level of $3,000.
Central Bank Demand Fuels Resilience
According to Deutsche Bank, central bank purchases are currently the largest driver of gold demand, with China accounting for 48% of global central bank buying. This wave of accumulation has outweighed a collapse in jewellery demand, which is expected to hit its lowest level since 1989, largely due to record-high prices.
The shift in demand drivers reflects a broader theme: gold is increasingly being used as a reserve asset, particularly by emerging markets seeking diversification away from U.S. treasuries. Concerns around growing U.S. fiscal deficits and the possibility of a sweeping import tariff have also helped boost gold’s appeal as a hedge against currency debasement and economic disruption.
See also: Week Ahead: Tariff Bombshells in Sight
Technical Analysis
Gold experienced a sharp drop to a recent low of $2,999.53 after peaking near $3,047.48, marking a clear rejection from higher levels. However, the price rebounded and entered a steady consolidation phase, holding above the $3,020 level. The recovery has been gradual but consistent, supported by a series of higher lows and narrowing price action.
Picture: Gold rebounds from sub-$3,000 dip, but momentum remains cautiously, as seen on the VT Markets app
The MACD is showing signs of bullish momentum rebuilding, with the MACD line crossing above the signal line and histogram bars turning green. Moving averages (5, 10, 30) are beginning to flatten, suggesting a potential shift in sentiment, though price needs to break past the $3,031.02 high for a stronger confirmation.
Cautious Forecast: Gold Faces Dual Pressures
While gold remains buoyed by central bank demand and macroeconomic concerns, record-high valuations may cap near-term upside. Shrinking jewellery demand and profit-taking near all-time highs could introduce choppy price action in the sessions ahead.
Traders should watch for a clean break above $3,048–$3,065 to confirm further upside, while a failure to hold above $3,000 could see gold consolidate or retrace mildly toward $2,980–$2,950.
In the near term, gold’s path will likely hinge on tariff announcements from the U.S., developments in U.S. debt policy, and further signals from central banks—all of which could strengthen its safe-haven appeal or limit demand if risk sentiment stabilises.
