Gold Price Slumps 1.2% to $4,157.90 Despite Record Chinese Imports and Central Bank Buying Spree
Published on 06/23/2026 at 20:06 | Redaktion boerse-global.de
A curious disconnect is playing out in the gold market. China has imported a staggering 692 tonnes of the metal in the first five months of the year — imports in May alone hit 163 tonnes, the highest since March 2024 — and central banks globally are still buying. Yet the price of bullion keeps sinking. The troy ounce last traded at $4,157.90, a daily decline of 1.23%, and sits roughly 26% below the January peak of $5,627.
The culprit is the Federal Reserve. New chairman Kevin Warsh has reiterated a hawkish line on inflation, refusing to rule out further rate hikes. Markets now assign a 70% probability to a move in September. That expectation has pushed the US Dollar Index to its highest since May 2025, making gold more expensive for buyers outside the dollar zone, and lifted the yield on ten-year Treasuries to 4.5%. For an asset that pays no interest, the opportunity cost has rarely been clearer.
Physical demand is also showing cracks. Global jewellery consumption collapsed by nearly a quarter in the first quarter, and physically backed gold ETFs such as the GLD fund have suffered noticeable outflows. In Asia — the world's biggest buying region — gold is changing hands at a discount, a sign that the appetite in China and India is softening. A fading geopolitical risk premium adds to the pressure. Reports of a possible ceasefire in the Middle East and diplomatic progress on the Iran front, which triggered a price surge after February 28, 2026, are coaxing capital back into riskier assets. Silver has been dragged down too, dropping to just under $62.
Should investors sell immediately? Or is it worth buying Gold?
Central banks still provide a floor. Despite the near-term gloom, the institutional buyer base remains engaged. According to the World Gold Council, 45% of central banks surveyed plan to increase their reserves over the coming year. Poland alone has bought 45 tonnes this year, and the Turkish central bank has been an active buyer as well. That support is, however, being overwhelmed by the sheer weight of macro headwinds. The euro slipped to $1.1383, its lowest since June 2025, and the relative strength index for gold sits at 35 — a technically oversold reading that has yet to trigger any meaningful relief rally.
The analyst community is split on where the metal goes from here. Goldman Sachs has slashed its end-2026 forecast from $5,400 to $4,900. J.P. Morgan looks for roughly $6,000 in the fourth quarter of 2026, while Bank of America holds at $6,000 provided the de-dollarisation trend endures. On the chart, the next key support level stands at $4,044. A break below that could open the door to further technical losses.
For now, the market is caught between two forces: insatiable central bank buying and historic demand from China on one side, and a resolutely hawkish Fed and a strong dollar on the other. Which force will prevail is likely to become clearer when the central bank delivers its next rate verdict this autumn.
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