ING’s commodities team, led by Warren Patterson and Ewa Manthey, reports that Gold edged higher on Tuesday as lower Oil prices and stronger bond markets eased inflation concerns and reduced expectations of further rate hikes. They emphasize persistent central bank demand, with World Gold Council data showing continued net buying driven by long-term reserve diversification.

Official-sector demand underpins prices

“Gold edged higher on Tuesday, recovering early losses as lower oil prices and stronger bond markets eased inflation concerns and tempered expectations of further interest rate increases. Persistent central bank buying also continued to provide support.”

“World Gold Council data showed central banks remained net buyers in August, adding 39 tonnes and bringing year-to-date purchases to 170 tonnes. China led purchases with 20 tonnes, extending its buying streak to 22 consecutive months, while Poland and Uzbekistan each added 8 tonnes to their reserves.”

“Turkey returned as a net buyer in August, purchasing 3 tonnes after three consecutive months of net sales. Other buyers included Kazakhstan, the Czech Republic, Bolivia and Ghana. Russia reduced its gold holdings by 6 tonnes.”

“The latest data suggests official-sector demand remains resilient despite elevated gold prices, with purchases continuing to be driven by longer-term reserve diversification objectives rather than short-term market movements.”

“With China, Poland and several emerging-market central banks continuing to accumulate gold, official-sector demand is likely to remain an important source of support for the market in the months ahead.”