Gold’s Physical Demand Sets 2026 Record Even as a Hawkish Fed and Surging Dollar Knock It Toward $4,000
29.06.2026 - 08:24:14 | boerse-global.de
More than 40,800 delivery notices are piling up on the COMEX, demanding 127 tonnes of gold be physically handed over this month alone — the highest monthly tally this year. Yet the spot price keeps sliding. The disconnect between a voracious physical market and a selloff driven by macro fears has rarely been starker.
Gold traded near $4,058 on Wednesday morning, putting it on course for a weekly loss of roughly 2.5%. It closed Tuesday at $4,104, nursing its fourth consecutive weekly decline. The metal is now 27% below the all-time high struck in January and down 5.5% since the start of the year.
Dollar Strength and Rate Expectations Overpower Every Other Signal
The main drag is not geopolitics, despite fresh skirmishes between US and Iranian forces near the Strait of Hormuz. Normally such tensions send investors rushing to the safe haven. This time the overriding factor is a hawkish turn by the Federal Reserve under its new chair, Kevin Warsh. The core PCE inflation gauge accelerated to 4.1% in May, well above forecasts, and markets now price in three rate hikes this year, with a 62% probability of the first move coming in September.
A strong dollar is compounding the pain. The greenback hit a 13?month high, making gold more expensive for overseas buyers. Higher yields on interest?bearing assets are also sucking demand away from the non?yielding metal. Goldman Sachs has already responded by cutting its year?end 2026 target for gold from $5,400 to $4,900, arguing that the Fed will not cut rates this year.
Should investors sell immediately? Or is it worth buying Gold?
A Paradox in the Middle East
Normally an escalation like the one in the Strait of Hormuz would be a tailwind for gold. Instead, the market is worried about the opposite effect: a conflict?driven spike in inflation would force the Fed to tighten even more aggressively. That fear is overriding the traditional safe?haven bid.
Central Banks: A Steady Hand Beneath the Surface
The official sector is providing a powerful counterweight. A World Gold Council survey of 76 central banks reveals that 89% expect global gold reserves to rise over the next twelve months, and 45% plan to actively increase their own holdings — a record share in the survey’s history. Global central?bank stockpiles already sit at a 50?year high of more than 36,000 tonnes.
On the COMEX, open interest climbed 5.5% in a week to 363,192 contracts, and data from the Commitment of Traders report show large speculators are trimming their short positions. The physical delivery volume at 127 tonnes for the current contract month is a clear vote of confidence from end?users.
Chart Levels and a Florida Wild Card
Technically, gold has broken below its 200?day moving average. The $4,000 round number now acts as the next meaningful support. The relative strength index sits at 37, deep in oversold territory, suggesting the selloff may be stretched. A break below $4,000 would likely test the 52?week low near $3,901, but if the level holds, a bounce toward $4,200 is plausible.
One small but symbolic development is a new Florida law that from July 1 makes gold and silver coins legal tender, with tax exemptions. While its market impact is negligible, it reflects the deepening political interest in physical gold within the US.
Gold at a turning point? This analysis reveals what investors need to know now.
The Week Ahead: A Data Storm in a Shortened Session
The real test comes in a condensed week. The US markets are closed Friday for Independence Day, so the non?farm payrolls report moves to Thursday. Alongside it, investors face a barrage of releases: June PMIs, JOLTS job openings, the ISM manufacturing index, and the unemployment rate. At the same time, the ECB’s annual forum in Sintra will feature Fed Chair Kevin Warsh, and every word will be parsed for hints on the rate path.
A weak payrolls number could give gold the cover it needs to defend $4,000 and rally. A robust print would reinforce the rate?hike narrative and put the psychological barrier under severe pressure. For a market caught between record physical demand and punishing macro headwinds, Thursday will likely set the tone for the rest of the summer.
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