GOLD
Investors continue to favor gold as a preferred safe-haven instrument during times of uncertainty. Gold rose around 64% in 2025 and extended its rally into 2026, gaining roughly 14% so far this year. At one point in January, gold reached a fresh all-time high near $5,600 per ounce. Several factors combined to support demand, including rising geopolitical tensions, central banks increasing their gold reserves, expectations that the Federal Reserve may cut interest rates further in 2026, and a relatively weaker U.S. dollar. China’s Lunar New Year could add further momentum, as physical demand from China has yet to fully impact the market.
- CHINA GOLD DEMAND REMAINS STRONG
China’s gold reserves rose for a 15th consecutive month in January 2026. Latest reports showed that reserves increased to 74.19 million ounces, with China remaining the world’s top gold buyer since 2020. According to recent data, as of January 2026 China has purchased around 357 tons of gold since 2020. Poland ranks second, having bought approximately 314 tons over the same period, followed by Turkey with around 252 tons. India is the fourth-largest gold buyer since 2020, adding roughly 245 tons.
- CHINA: LUNAR NEW YEAR TO BOOST DEMAND FOR PHYSICAL GOLD
The Chinese Lunar New Year falls on February 17 this year, with the holiday period spanning from February 15 to February 23. One of the most important gifts exchanged during this time is gold, which is considered a symbol of prosperity in China. As a result, the physical gold market typically experiences a seasonal boost during this period. China is the largest consumer of physical gold in the world, followed by India. The Lunar New Year is the strongest seasonal driver in the first quarter, with China typically consuming between 170 and 200 tons of gold for the celebrations.
- GOLD: GEOPOLITICAL UNCERTAINTIES TO BOOST DEMAND
Gold typically rises in demand during periods of geopolitical stress and market uncertainty. As 2025 ended, a series of global flashpoints continued to support safe‑haven flows into the metal. A major development was the U.S. military’s operation to capture Venezuelan President Nicolás Maduro in early January 2026, an unprecedented move that added to market volatility. At the same time, the ongoing conflict between Russia and Ukraine continues to weigh on risk sentiment. Another key source of uncertainty is the tense crisis between the United States and Iran. Although indirect talks are underway, both sides have maintained strong military postures, and the U.S. has sent the USS Gerald R. Ford to the Middle East to join the USS Abraham Lincoln amid rising regional tensions. With concerns that these conflicts could escalate further, investor risk aversion remains elevated, underpinning demand for gold.
GOLD: OTHER FACTORS TO SUPPORT DEMAND
Market participants have also been closely watching factors such as central bank gold purchases, U.S. economic data, and Federal Reserve monetary policy. Since late 2022, central banks worldwide have been increasing their gold purchases, building up reserves and signaling continued confidence in gold as a core monetary asset. Meanwhile, U.S. economic indicators remain supportive of accommodative policy. The unemployment rate has stayed relatively high, above 4%, while headline inflation continues to fall toward the Fed’s 2% target, most recently reaching 2.4% in January 2026. Based on this data, the U.S. Federal Reserve is widely expected to continue cutting interest rates in 2026, potentially sooner rather than later. Since September 2024, the Fed has already reduced rates six times, bringing them down from 5.5% to the current 3.75%.
Conclusion
Gold remains one of the instruments investors are likely to hold in 2026. After rising by around 64% in 2025 and gaining roughly 230% since 2020, it continues to sound attractive for market participants. Recent geopolitical tensions have further supported gold demand, while the ongoing Lunar New Year holiday in China could provide additional momentum. Major investment banks on Wall Street have also maintained a positive outlook on gold. J.P. Morgan recently raised its price target to $6,300, while UBS AG increased theirs to $6,200. Wells Fargo noted that lower short-term interest rates, combined with sustained central bank demand, could push gold prices into the $6,100–$6,300 range.