Global gold prices tumbled during Friday\u2019s trading session following\na resurgence of the US Dollar. Nevertheless, gold successfully ended a\nmonthly downward trend that had lasted for four consecutive months.\nAccording to Refinitiv, global gold prices closed at US$4,040.94 per\ntroy ounce on Friday (31\/7\/2026), representing a depreciation of\n1.50%.<\/p>\n
This decline trimmed July\u2019s gains to 0.84%. However, this result\nstill marks the first monthly increase since February 2026, after gold\nhad consistently ended in the red for four straight months. Pressure on\ngold on Friday emerged after the US Dollar rose from its lowest level in\nover a month. A day earlier, the dollar index plunged approximately\n2.4%, marking its largest single-day decline since January 2023.<\/p>\n
A stronger dollar makes gold more expensive for holders of other\ncurrencies, which tends to reduce demand. Despite the weakness, gold\nprices managed to remain above the psychological level of US$4,000 per\ntroy ounce. Lower US inflation data also helped protect gold prices from\ndeeper pressure. Data released on Thursday showed the US Personal\nConsumption Expenditures (PCE) price index fell by 0.1% month-on-month\nin June. This slowdown in inflation led market participants to reduce\nbets on further interest rate hikes by the US Federal Reserve.<\/p>\n
Bybit market analyst Han Tan noted that gold is still struggling to\nmove significantly above the US$4,000 psychological level, even as it\nstands on the verge of ending a four-month decline. According to Tan,\ngold prices are still supported by expectations that Fed Chair Kevin\nWarsh may expand the central bank\u2019s focus beyond inflation indicators\nand interest rate hikes. While Warsh reaffirmed his commitment to\nreducing inflation this week, he has not yet provided a clear signal\nthat the Fed is prepared to raise interest rates again. According to the\nCME Group FedWatch tool, market participants estimate a 65% chance of a\nrate hike at the September meeting, down from over 80% the previous\nweek. A reduced probability of rate hikes serves as a positive sentiment\nfor gold, as high interest rates typically dampen the appeal of precious\nmetals which yield no interest.<\/p>\n
Central Banks Resume Gold Buying in Q2-2026<\/p>\n
The World Gold Council (WGC) reported that net gold demand from\ncentral banks reached 289 tonnes in the second quarter of 2026. This\nfigure represents a fivefold increase compared to the revised 57 tonnes\nin Q1-2026 and marks a record high for a second-quarter period. Compared\nto the 177.9 tonnes recorded in the same period last year, net purchases\nincreased by approximately 62%. The WGC attributes this surge to\ngeopolitical tensions, falling gold prices, and the need for reserve\ndiversification.<\/p>\n
Poland was the largest buyer, adding 51 tonnes during Q2, bringing\nits reserves to 632 tonnes by the end of June. The Chinese central bank\nadded 33 tonnes in Q2, its largest quarterly purchase since late 2023,\nbringing its total reserves to 2,346 tonnes. Purchases were also made by\nUzbekistan (16 tonnes), Kazakhstan (15 tonnes), Jordan, and the Czech\nRepublic (6 tonnes each). Conversely, Russia was the largest seller,\noffloading 22 tonnes of gold.<\/p>\n
Despite the surge in Q2 purchases, net central bank demand for the\nfirst half of 2026 reached only 345 tonnes, the lowest for a first-half\nperiod since 2022. This was due to significant sales by Turkey, Russia,\nand Azerbaijan in the first quarter. The WGC expects central bank demand\nto remain above long-term averages. The organisation\u2019s survey shows that\n89% of foreign exchange reserve managers expect global central bank gold\nholdings to increase over the next 12 months, with 45% of respondents\nplanning to increase their own institutional gold reserves.<\/p>", "url": "https:\/\/jawawa.id\/newsitem\/global-gold-prices-plummet-1-5-amid-strengthening-us-dollar-1785545530", "image": "" }, "sponsor": "Okusi Associates", "sponsor_url": "https:\/\/okusiassociates.com" }