I think that when oil prices start to fall, inflation fears will ease, interest rates will drop, the economy will gain momentum, and money will shift from government bonds to the stock market.
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The price of gold is currently in an interesting situation.
The price of gold has fallen sharply in recent days, as investors reduce their risk levels and free up capital. In just over a week, the drop has been about twenty percent.
During Monday, the price of gold per ounce fell to a low of about $4,100, from which it has sharply climbed upwards.
At its lowest, the price of gold almost touched the 200-day moving average, but did not fall below it.
If one believes that the long-term upward trend in the price of gold will continue, such a retreat to the vicinity of the 200-day moving average is often an excellent buying opportunity.
On the other hand, the price falling below $3,900 would indicate a break in the long-term upward trend, thus offering a natural stop-loss limit. The distance to this limit is currently less than 9 percent.
Happy Monday!
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Hereâs Jussi Halmeâs video about gold. 
Why is the price of gold falling, even though the global situation is volatile?
Traditional investment logic says that wars and inflation drive up gold, but the market is now serving up something entirely different. This video deconstructs the paradox surrounding the price of gold: why rising oil prices and high interest rates are poison for the âyellow metal,â and why the dollar remains the number one option in a crisis.
In this episode, we will cover:
The relationship between interest rates and gold: Why does a 5% risk-free return beat a gold nugget?
The real interest rate paradox: How inflation can turn against gold.
Liquidity and âCrowded Tradeâ: Is gold being sold simply because itâs easy?
The role of central banks: Are buyers turning into sellers amid an energy crisis?
Investment strategy: Is gold insurance or an investment?
Gold is not just a metal â itâs a mirror reflecting confidence in our monetary system. If you want to understand where the market is headed, you need to understand the macroeconomics behind gold.
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Hereâs a SalkunRakentaja article about gold and, among other things, central bank gold purchases.
Central banksâ buying behavior creates a structural demand base for gold that fundamentally differs from traditional price drivers such as inflation expectations or real interest rates.
With nearly half of the worldâs central banks planning to increase their gold reserves, a kind of institutional floor is forming below the price.
This, of course, does not mean that the price of gold cannot fall. The March correction showed that short-term fluctuations can be significant.
However, the long-term demand structure has changed in a way that favors gold compared to previous decades.
Subheadings:
- Central Banks Buying at a Record Pace
- Brazil Doubled Its Gold Holdings
- What Changes from an Investorâs Perspective?
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Central banks remained on the buying side in February 2026 as well, with the National Bank of Poland being the largest augmenter, according to the World Gold Council report published a few days ago. Neighboring Czechia follows Polandâs example and continues to make gold investments â now marking the 36th consecutive month of additions! In addition to Poland, Uzbekistan has been one of the largest buyers this year.
On the reducing side are our eastern neighbor and Turkey.
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Money has been flowing out of gold ETFs at an exceptionally high rate for the fourth week in a row. This might indicate that investors are moving somewhat quickly and nervously right now. Goldâs momentum might not be gone, but the changed mass flows currently tell us somethingâŠ
Over this period, global gold ETFs have amassed -$12.2 billion in outflows, on track for the largest monthly withdrawal in history.
By comparison, the April 2013 record was -$8.7 billion.
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A couple of weeks ago, the Bank of France announced that they sold all their gold in New York (129 tonnes) to someone and then bought the same amount back from Europe. As a result of this process, they made a reasonable profit of 12.2 billion EUR. A slightly different operation than what the Bank of Finland did a year earlier. This perhaps had more style and intelligence.
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The price of gold also rose because Iran announced that the Strait of Hormuz is open for trade again during the ceasefire between Israel and Lebanon.
This also calmed the markets; oil prices fell and stocks rose, but at the same time, the United States and Iran are negotiating an agreement, although of course, everything is not yet fully certain.
The price of gold is also influenced by factors such as interest rates and the value of the dollar, which guide investorsâ decisions.
At the same time, the U.S. dollar firmed, buoyed in part by the view that heavy energy exports would help immunize the U.S. economy from oil supply disruptions through the Strait of Hormuz. A stronger dollar can make gold more expensive for overseas buyers. A tracker of the U.S. dollar slumped on Fridayâs after Araghchiâs announcement, then recovered some losses to trade flat.
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The article below states that the price of gold fell sharply because markets are awaiting confirmation of potential peace talks between Iran and the United States before the actual ceasefire ends.
Uncertainty about the Middle East war, energy supply, and interest rate policy continues to weigh on gold. In addition, the strengthening dollar and rising interest rates simultaneously weakened demand for such metals.
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I was trying to dig into Comtrade to get a handle on the reasons for the rise in the price of gold in recent years, but I havenât finished yet because India and China havenât sent their trade data to the UN agency.
Of course, we have central bank tracking from the Gold Council, but the overall picture remains incomplete as private investments, funds, companies, and potential hidden sovereign purchases are not taken into account. This is why customs statistics provide a good way to gain additional insight.
In Chinaâs case, trade data for gold exports and imports is available from 2015 to the end of 2024. India, on the other hand, has this data for 2010â2024.
You could say the countries are very similar. They import a lot of gold from abroad but hardly export any to other countries (relative to the volume of imports). This is, of course, very interesting in Chinaâs case, as the country is nevertheless the worldâs largest gold producer. This means thereâs a lot of gold stored somewhere, given that the net increase from foreign trade alone during the analysis years has been 599 billion USD. For India, the increase is in the same range, though over a period five years longer.
Both countriesâ imports and the gold supplied to their domestic markets via foreign trade are growing in the long term, but since 2021, Chinaâs imports have risen significantly (and twice as much as the price in 2021â24). So, one could think that Chinaâs imports, in particular, have been supporting the price during this time.
| China | |||
|---|---|---|---|
| Export | Import | Import-Export | |
| 2010 | |||
| 2011 | |||
| 2012 | |||
| 2013 | |||
| 2014 | |||
| 2015 | $1 866 300 922 | $78 976 974 780 | $77 110 673 858 |
| 2016 | $1 237 265 211 | $63 984 721 454 | $62 747 456 243 |
| 2017 | $469 830 859 | $51 391 774 152 | $50 921 943 293 |
| 2018 | $783 268 372 | $62 273 206 906 | $61 489 938 534 |
| 2019 | $982 326 331 | $43 917 764 709 | $42 935 438 378 |
| 2020 | $3 545 015 055 | $11 414 919 164 | $7 869 904 109 |
| 2021 | $3 145 976 718 | $47 279 366 447 | $44 133 389 729 |
| 2022 | $3 281 251 509 | $76 653 531 864 | $73 372 280 355 |
| 2023 | $3 891 153 399 | $91 915 683 973 | $88 024 530 574 |
| 2024 | $12 358 141 473 | $102 710 597 652 | $90 352 456 179 |
| 2025 | |||
| Total | $31 560 529 849 | $630 518 541 101 | $598 958 011 252 |
| India | |||
|---|---|---|---|
| Export | Import | Import-Export | |
| 2010 | $109 439 843 | $38 352 372 133 | $38 242 932 290 |
| 2011 | $441 307 776 | $53 685 534 249 | $53 244 226 473 |
| 2012 | $34 105 846 | $52 606 771 655 | $52 572 665 809 |
| 2013 | $2 459 786 136 | $37 711 847 012 | $35 252 060 876 |
| 2014 | $2 433 076 925 | $31 039 689 173 | $28 606 612 248 |
| 2015 | $5 311 677 871 | $34 999 548 560 | $29 687 870 689 |
| 2016 | $4 335 429 094 | $22 944 489 540 | $18 609 060 446 |
| 2017 | $2 272 508 210 | $36 154 609 426 | $33 882 101 217 |
| 2018 | $233 023 | $31 756 390 865 | $31 756 157 843 |
| 2019 | $101 796 368 | $31 178 358 668 | $31 076 562 300 |
| 2020 | $255 352 177 | $21 922 211 576 | $21 666 859 399 |
| 2021 | $5 318 136 | $55 782 957 847 | $55 777 639 711 |
| 2022 | $75 275 837 | $36 574 558 371 | $36 499 282 534 |
| 2023 | $74 514 562 | $42 644 273 707 | $42 569 759 145 |
| 2024 | $347 236 209 | $57 568 300 894 | $57 221 064 685 |
| 2025 | |||
| Total | $18 257 058 012 | $584 921 913 677 | $566 664 855 665 |
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Central bank gold trading statistics for the first quarter have been released (World Gold Council). In March, for the first time in a long while, there was a significant net reduction. The primary reasons are Turkey and our eastern neighbor (though with a 10-times smaller reduction amount). Both, of course, have the same reason for their actions â the state needs quick financing for its expenses. There was a similar reduction for a few months in 2023, and back then prices also declined somewhat (but the year overall ended with an 8.7% increase).
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