Gold's Fragile Recovery Faces a Fresh Blow as Chinese Banks Halt Retail Trading
25.06.2026 - 21:42:16 | boerse-global.de
A nascent bounce in gold prices is colliding with a dramatic supply-side shock from Asia. Several of China's largest lenders are terminating retail gold trading, a move that threatens to drain a critical source of demand just as the metal tries to reclaim the $4,000 handle.
Industrial and Commercial Bank of China (ICBC) will end private-client gold transactions from July 2026. Other major institutions are following suit, citing excessive volatility and tightened risk controls. The decision could hollow out Asian buying, which has been a key support for bullion in recent years. Spot gold was last seen at $4,046.70, a marginal daily gain of less than one percent after falling as low as $3,901.30 — its 52-week trough — in the previous session.
Hawkish Fed Casts a Long Shadow
The root of the broader weakness remains US monetary policy. Kevin Warsh, the new Federal Reserve chair, has sharply revised the central bank's inflation forecast for 2026 upward to 3.6%. The core personal consumption expenditures price index, the Fed's preferred gauge, already climbed to 3.4% in May. That has erased any near-term hope of rate relief. Derivatives markets now assign more than a 60% probability of a rate hike in September, with no cuts expected before 2027.
Warsh has explicitly signaled a willingness to raise rates further if needed. The consequence is a resurgent dollar — the euro hit a one-year low this week — which makes dollar-denominated gold more expensive for overseas buyers and depresses demand.
Should investors sell immediately? Or is it worth buying Gold?
Geopolitical Tailwinds Fade
Adding to the pressure, the safe-haven premium that propped up gold for much of the past two years is evaporating. Reports of progress in US-Iran nuclear negotiations have eased tensions. President Donald Trump has discussed long-term international inspections of Iranian atomic facilities, a claim Tehran denies but which has nevertheless prompted capital to rotate out of haven assets. Shipping traffic through the Strait of Hormuz is normalizing, and a US sanctions exemption for Iranian oil is further soothing energy-related inflation fears. The flight to safety is simply not materializing.
Structural Support from Central Banks
Yet the selloff has not been as catastrophic as it might have been, thanks to steadfast central bank buying. Monetary authorities purchased a net 244 tonnes of gold in the first quarter, continuing a streak of more than 1,000 tonnes annually since 2022. This institutional demand provides a floor, even as private retail buyers — particularly in the jewellery sector — balk at still-elevated prices.
Chart Signals and Forecasts
Technically, the metal is flashing mixed signals. After losing over 10% in the past 30 days, the relative strength index has dipped to 33, territory that often precedes a short-term bounce. Spot gold is trading roughly 10% below its 50-day moving average at $4,496, a level that must be reclaimed cleanly to improve the chart picture. Failure to do so keeps the 52-week low of $3,901.30 in play — a break below that would likely trigger a fresh wave of selling.
Gold at a turning point? This analysis reveals what investors need to know now.
Analysts are responding to the deteriorating macro backdrop by slashing their targets. Goldman Sachs cut its end-2026 forecast to $4,900, citing the delayed rate-cut cycle. ING trimmed its fourth-quarter estimate to an average of $4,600 an ounce. Both forecasts imply upside from current levels, but the path is littered with enough headwinds — China's withdrawal, a hawkish Fed, and a fading geopolitical risk premium — to make the rally anything but assured.
Ad
Gold Stock: New Analysis - 25 June
Fresh Gold information released. What's the impact for investors? Our latest independent report examines recent figures and market trends.
