Gold's ETF Cushion Holds as Asia's Buyers Step Back and Washington Tightens the Screws
Published on 11/07/2026 at 16:52 | Editorial boerse-global.de
Gold demand is leaning on a narrower base than it did a year ago. Physically backed ETFs and central banks are doing the heavy lifting, while jewellers, small-bar hoarders and coin collectors have pulled in their horns — a split that leaves the market unusually dependent on whether institutional money keeps flowing.
Figures from the World Gold Council put ETF inflows at 211 tonnes, lifting holdings to 4,256 tonnes. That made these funds, alongside official-sector buyers, one of the two pillars holding demand upright. Strip them out and the picture darkens: bar and coin purchases fell 19% year on year to 268 tonnes, and jewellery demand slid 17%. Overall global gold demand came in at 1,369 tonnes, down 1% from a year earlier.
Supply told a similarly mixed story. Mine output rose, but recycling dropped 8% to 314 tonnes, so total gold supply also finished 1% lower. Higher production therefore met a partially offsetting fall in scrap, leaving the headline supply number in the red.
A payrolls surprise resets the mood
The metal's price action has done nothing to soothe nerves. Spot gold settled yesterday at USD 4,063.65 an ounce, a daily move of -0.6%, after a far stronger-than-expected US employment report took the steam out of a recovery. Non-farm payrolls added 165,000 jobs in October and the unemployment rate stood at 4.1%, comfortably beating forecasts.
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The ripple ran through several markets at once. The dollar firmed and Treasury yields climbed after the release, and Bloomberg reports that traders now largely expect the Federal Reserve to raise rates in December. That combination is heavy weather for a metal that pays no coupon. Positioning confirms the caution: fund managers cut their bullish gold bets in the week to 3 November to the lowest level since June, according to Bloomberg.
Beijing keeps buying
Against that, official-sector demand keeps offering a counterweight. Reuters reports that China's central bank extended its gold-buying streak today to a 24th consecutive month. The World Gold Council separately logged another month of inflows into globally listed gold ETFs for October 2026 — a net USD 2.7 billion — with holdings reaching a month-end record of 4,275 tonnes. The regional split was stark: Europe and Asia saw inflows while North America recorded outflows.
Brokerage LS Securities struck a bullish note, arguing gold is now as undervalued as at any point since 2022. Analyst Hong Seong-gi called the price decline overdone and framed the dip as an attractive entry point — conditional on US rate hikes coming to an end in the first half of 2027.
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Inflation data takes centre stage
Tuesday's US consumer price report is the next hurdle. Analysts warn that a hot reading would make a December rate rise more likely, while a softer print could give bullion room to breathe. Initial jobless claims, existing home sales and US producer prices follow later in the week, with central bank commentary also in the frame.
The World Gold Council flags rising rates and uneven inflation expectations as potential headwinds, while geopolitical risk and financial-market stress could lend support. For investors, the arithmetic is straightforward: ETF flows can cushion the market only for as long as the appetite for those products lasts. Weak jewellery buying and hesitant bar and coin demand narrow that cushion — and with rate pressure showing no sign of easing, the durability of institutional demand is about to be tested.
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