Gold's Rally Reaches a Two-Month Peak — But the Hardest Test Arrives Midweek
Published on 08/12/2026 at 07:50 | Redaktion boerse-global.de
Gold pushed past $4,400 an ounce on Tuesday, settling at $4,443.70, its strongest level in roughly two months. The move caps a 30-day run that has seen the precious metal gain 10.86 percent — momentum that now faces its most consequential hurdle yet: a pair of US inflation reports due in the coming days.
A Labor Market Surprise Set the Wheels in Motion
The immediate catalyst traces back to Washington. The Bureau of Labor Statistics reported a loss of 23,000 nonfarm payrolls for July, a stark miss against the 80,000 gain analysts had penciled in. Wage growth also came in softer than anticipated.
That combination has shifted expectations for the Federal Reserve's September meeting. Rather than bracing for another hike, traders are increasingly pricing in a pause. Lower rate expectations reduce the opportunity cost of holding a non-yielding asset like gold — a dynamic that explains much of the recent buying wave.
China's Central Bank Is Buying at a Record Clip
While the labor data provided the spark, a structural bid from Asia has been building underneath the rally. China's central bank added roughly 20 tonnes to its reserves in July, following June's 15-tonne increase — the largest monthly accumulation since October 2023.
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Chinese institutional investors are following suit, using the metal as a hedge against turbulence in technology markets. Gold-backed exchange-traded funds in China are now logging their longest streak of inflows in months, and physical demand across Asia remains robust. Central banks broadly are replenishing reserves at the fastest pace in years, with Beijing leading the charge.
This institutional demand differs fundamentally from short-term bets on Fed policy. It functions more as a foundation — a steady bid that supports the rally even when sentiment wavers.
Geopolitics Keeps the Risk Premium Elevated
The unresolved standoff between the US and Iran continues to underpin prices. Investors are still waiting on a potential agreement that would reopen the Strait of Hormuz and ease tensions in the region.
Energy prices have pulled back from recent highs on signals that a deal might be within reach. That has helped temper inflation concerns — and by extension, the risk that rising costs could force the Fed to keep rates higher for longer.
Market activity reflects the heightened nervousness. Spot trading volumes jumped roughly 95 percent within a single week, with open interest in futures expanding at a similar clip.
The Technical Picture Shows a Market Heating Up
The rally has gathered pace quickly, and the charts are beginning to flash warning signs. The relative strength index sits at 68, approaching overbought territory. Gold currently trades 6.53 percent above its 50-day moving average of $4,171.19 — a level that, after months of decline, is finally turning upward again.
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Still, the path back to record highs remains long. The metal sits roughly 20 percent below its 52-week peak of $5,586.20, set in late January.
Wednesday's Inflation Print Could Settle the Debate
The near-term direction now hinges on two inflation reports due this week. The consumer price index for July lands on Wednesday, followed by the producer price index on Thursday. Also on the docket: weekly jobless claims and the University of Michigan's preliminary August inflation expectations.
Softer-than-expected inflation data would reinforce bets on a Fed pause and likely push gold higher. A hot print, by contrast, could force the central bank to reconsider its restraint — a scenario that would test the durability of this rally. For gold investors, the next 48 hours are shaping up as the week's defining moment.
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