Gold prices ended a two-week losing streak as technical buying around the key $4,000 per ounce level helped the precious metal withstand renewed inflation fears, rising oil prices, higher US Treasury yields and growing expectations that the Federal Reserve could maintain a tighter monetary policy stance.
Spot gold rose 0.1 percent to settle at $4,052.98 per ounce, while gold futures gained the same margin to close at $4,055.25 per ounce. Both benchmarks advanced about 0.9 percent over the week.
The modest weekly gain masks a volatile period for bullion. Gold prices, which had fallen to levels last seen in early November, staged a rebound after finding support below $3,960 per ounce before surrendering part of the advance as the US dollar strengthened and Treasury yields surged.
The price action has placed the Federal Reserve’s monetary policy decision firmly at the centre of the gold market outlook.
David Morrison, senior market analyst at Trade Nation, said gold’s recovery had been unable to establish a stronger upward trend after the metal briefly climbed above $4,160 per ounce.
“Gold began a fight-back rally this time last week after falling to an eight-month low below $3,960. By Wednesday afternoon it had topped $4,160 for an overall move of $200 per ounce, or 5%. But it was unable to build on these gains, particularly as the US dollar roared back to life after dropping significantly on soft US inflation data,” Morrison said.
He added that the combination of geopolitical tensions, stronger oil prices and rising Treasury yields had weighed on bullion.
“The escalation in hostilities between the US and Iran, the stronger oil price and the jump in US Treasury yields saw the dollar bounce and gold slump,” he said.
Despite the immediate pressure from higher yields and a stronger dollar, the gold market is being supported by a structural force that continues to reshape global bullion demand: central-bank accumulation.
While investors have become more cautious about gold at record price levels, central banks have continued to expand their reserves, suggesting that official-sector demand is increasingly being driven by strategic considerations rather than short-term price expectations.
According to the latest World Gold Council reserve data and LBMA gold prices analysed by BestBrokers as of July 21, 2026, central banks collectively hold 36,664.5 tonnes of gold.
That represents 16.7 percent of the estimated 219,890 tonnes of gold mined throughout human history.
At current market prices, official gold reserves are valued at approximately $4.78 trillion, a figure larger than Germany’s annual economic output and broadly comparable with the market value of some of the world’s largest technology companies.
The scale of central-bank holdings underlines the continuing role of gold in the global financial system, even as monetary authorities increasingly rely on digital payments, fiat currencies and sophisticated financial markets.
Central banks keep buying despite record prices
The latest data shows that central banks remained net buyers of gold in 2026, even with bullion trading above $4,000 per ounce.
Reported purchases reached 224.2 tonnes during the year, compared with 221.4 tonnes sold, producing net buying of approximately three tonnes.
Although the net increase is relatively modest, analysts say the figures demonstrate the continued willingness of central banks to hold and acquire gold at historically elevated prices.
Poland has emerged as one of the most aggressive buyers.
The country added 102 tonnes to its reserves in 2025 and a further 63.6 tonnes in 2026. At current gold prices, those combined purchases are worth approximately $21.6 billion.
The value of Poland’s recent accumulation is more than seven times the combined value of the official gold reserves held by Ireland, Chile and El Salvador.
Alan Goldberg, lead data analyst at BestBrokers, said the continued accumulation showed that central banks were not simply buying gold in anticipation of higher prices.
“Over the past several years, central banks have steadily increased their gold holdings, continuing to buy even as bullion reached historic highs. This suggests that governments are not simply chasing returns, but reassessing the role of gold in a world shaped by geopolitical uncertainty, shifting currency dynamics and concerns over financial resilience,” Goldberg said.
He said gold’s attraction lay in its unique status as an asset without an issuer or default risk.
“Gold’s value lies not only in its market price, but in its unique position as an asset with no issuer, no default risk and a 5,000-year history as a store of value,” he added.
Five countries control more than half of official reserves
The concentration of gold holdings among the world’s largest economies is also striking.
The United States remains the world’s largest official gold holder, with 8,133 tonnes valued at approximately $1.06 trillion.
US reserves account for 22.2 percent of all official gold held by central banks worldwide.
Germany, Italy, France and China join the United States among the five largest official holders.
Together, the five countries hold 18,703 tonnes of bullion worth approximately $2.44 trillion.
