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Introduction

During the week of May 25–31, 2026, gold markets continue to navigate a complex interplay of macroeconomic signals, geopolitical pressures, and shifting central bank policies. Spot gold is currentlytradingaround$4,561perounce,withfuturesprojectionsrangingbetween$4,380 and $5,100 for May, reflecting persistent uncertainty. While short-term headwinds from a relatively firm USdollarandelevatedbond yieldshavekeptalidonnear-termpriceappreciation,thestructuralbull case for gold remains firmlyintact. Keydrivers including central bank accumulation, the ongoing Iran-Strait of Hormuz crisis, inflation concerns, and India`s significant import duty overhaul continue to shape the weekly outlook. Longer-term forecasts from J.P. Morgan and Goldman Sachs project prices approaching $5,000 per ounce by Q4 2026, with $6,000 per ounce a possibility in the medium term.

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Geopolitical Developments

Iran-Hormuz Conflict Continuesto Drive Safe-Haven Demand

The ongoing conflict between the United States and Iran, coupledwith the near-total disruption to oil transit through the Strait of Hormuz, remains a dominant force in global gold markets. US military officials are reportedly continuing to brief President Trump on potential operational steps, while the administration has indicated that its naval blockade of Iran will remain in place until a nuclear agreement is reached. Higher energy prices resulting from the supply disruption have stoked broader inflation fears, reinforcing the traditional flight-to-safety dynamic that benefits gold. Market participants are revising their interest rate cut expectations downward as a direct consequence of this energy-price shock, furthercomplicating the Federal Reserve`s policycalculus. Anyescalation or de-escalation in the Middle East will be a critical variable for gold pricing in the coming week. 

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The `Gold War`: Russia Sells, China Accumulates  

A strategic divergence between Russia and China continues to redefine global gold dynamics. Russia has now recorded four consecutive months of declining gold reserves as the Kremlin liquidates holdings to finance expanding budget deficits and rising military expenditures. As of the most recent reporting period, Russian gold reserves have declined to 73.9 million ounces, the lowest level since 2022. Notably, Russia has reportedly begun selling physical gold bullion for the first time in nearly 25 years, as Western sanctions have restricted its traditional mechanisms for leveraging gold reserves through paper transactions. In stark contrast, China`s central bank added a further 8 tonnes to its gold reserves in April 2026, according to the World Gold Council, bringing certified Chinese gold reserves above 2,322 tonnes. China has been a consistent buyer over the past 18 months. Analysts interpret this divergence as evidence that gold has emerged as a leading strategic reserve asset in the context of international economic competition: China views gold accumulation as a hedge against potential geopolitical sanctions and long-term financial instability. Chinese gold Exchange Traded Funds (ETFs) have also recorded substantial inflows alongside the central bank purchases.

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Saudi Arabia Expands Gold Reserves 

Saudi Arabia`s central bank has continued to add gold to its national reserves, consistent with a broader trend among Gulf Cooperation Council (GCC) nations to reduce their economic dependence on the US dollar. Middle Eastern sovereign wealth managers and central banks are responding to global economic instability, heightened geopolitical uncertainty, and volatility in oil prices by diversifying into gold. Analysts expect this trend to persist across GCC member states as a measure of financial resilience.

26-05-2026

Ghana Requests Increased Gold Production Allocation

The government of Ghana has formally requested that mining companies operating in the country increase the share of their gold production sold to the central bank from 20% to 30%. Ghana`s objective is to bolster its gold reserves, increase foreign exchange holdings, stabilize the local currency, and enhance economic resilience during periods of global turmoil. Mining companies have pushed back on the request, citing ongoing negotiations over price agreements and discount structures. The outcome of these discussions could have broader implications for gold supply dynamics in sub-Saharan Africa.

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Macroeconomic and Federal Reserve Policy

April FOMC Minutes Signal a Hawkish Pivot Risk

The Federal Open Market Committee (FOMC) minutes from the April 28–29, 2026 meeting, released on May 5, 2026, revealed a significantly hawkish tone that rattled gold markets. The Fed held the benchmark federal funds rate unchanged at 3.5%–3.75% for a third consecutive meeting. However, the vote was a contested 8-4 the most dissents recorded since October 1992 signalling deep divisions within the Committee on the appropriate policy path.

Critically, a majority of officials indicated that rate increases may become appropriate if inflation continues to run persistently above 2%, driven in large part by energy price pressures from the Middle East conflict. Many participants also expressed a preference for removing the `easing bias` language from the post-meeting statement a soft tightening signal that caused a sharp repricing in bond markets. Jerome Powell presided over this meeting as his final session as Chair; Kevin Warsh is set to assume the chairmanship, with Powell remaining on the Board as a governor. The next FOMC meeting is scheduled for June 16–17, 2026, and markets are now pricing in a 67% probability of no rate cuts at all in 2026. This extended higher-rate environment exerts downward pressure on gold in the short term, although structural demand drivers continue to provide underlying support.

US Economic Data Adds Near-Term Headwinds

Stronger-than-expected US economic data released during the past week dampened near-term rate cut expectations, causing gold prices to pull back approximately 1% to 1.5% from recent levels. A firmer US dollar and higher Treasury yields both weighed on gold. Nonetheless, longer-term economists remain constructive on gold, viewing inflation risk and geopolitical premiums as durable tailwinds that will reassert themselves once any short-term dollar strength fades.

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India`s Historic Gold Import Duty Increase

On May 13, 2026, the Government of India raised the customs duty on gold and silver imports from 6% to 15% the single largest increase on record, and a full reversal of the duty reduction implemented in July 2024. The new rate comprises a 10% basic customs duty and an additional 5% levy. At current spot prices, this adds approximately $704 per ounce to the cost of official imports. The duty hike was prompted by a sharp depreciation of the Indian rupee, which touched a record low of 95.75 against the US dollar on May 12. Prime Minister Narendra Modi also made a public appeal for Indian citizens to refrain from buying gold for one year, framing the request in the context of energy import pressures and rupee stabilization. In addition to the duty hike, the government has capped duty-free gold imports at 100 kilograms and introduced a requirement for fortnightly performance reports by importing entities.

The World Gold Council estimates that the combined impact of the duty hike could reduce Indian jewellery and investment gold demand by 50–60 tonnes in 2026, representing approximately 10% year-on-year. Despite the tighter regime, official imports in April 2026 reached $5.6 billion, suggesting some front-loading of shipments ahead of further restrictions. Historical precedent including duty hikes in 2013 and 2022 indicates that increases in official duty tend to drive a corresponding surge in unofficial or smuggled gold inflows, which could partially offset the reduction in formal import demand.

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India`s Gold Recycling Accelerates

Elevated gold prices and the recent import duty hike have combined to significantly accelerate gold recycling activity across India. According to the World Gold Council`s Gold Demand Trends India Focus Q1 2026 report, net recycling (scrap supply) in India reached 31.2 tonnes in Q1 2026 up 20% year-on-year and 44% quarter-on-quarter. Large jewellery retailers are actively promoting gold-exchange schemes, encouraging households to monetize idle ornaments stored in lockers.

Rather than purchasing newly imported gold, consumers and jewellers are increasingly reusing existing household gold stocks. India is estimated to hold approximately 20,000 tonnes of private gold

one of the largest concentrations in the world. Industry observers note that this shift is being driven not only by price incentives but also by changing consumer attitudes toward jewellery ownership,

improved transparency in exchange schemes, and digital gold infrastructure. While the formal recycling segment is expanding, deep-rooted traditions around gold as a sacred and long-term asset continue to limit the pace of formalization. The government and jewellers are both promoting recycling as a means to reduce import dependence and ease pressure on the current account deficit.

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China: Production, Recycling, and Reserve Growth

China Remains the World`s Largest Gold Producer

China continues to hold the top position in global gold production, mining in excess of 380 tonnes annually. The United States, Canada, Australia, and Russia also rank among the world`s top producers. Africa`s contribution is growing, now accounting for approximately one-quarter of the world`s annual gold supply, reinforcing the continent`s increasing importance to the global gold supply chain.

China`s Gold Recycling Sector Expands

Elevated domestic gold prices have incentivized widespread recycling of old jewellery and other gold items across China. Local refiners are better positioned to meet domestic demand from recycled material, reducing dependence on imported gold. This recycling trend is consistent with global dynamics, where record pricing stimulates greater supply from secondary sources, partially offsetting primary supply constraints.

China`s Official Gold Reserves Continue to Rise

As reported by the World Gold Council in April 2026, the People`s Bank of China added 8 tonnes to its gold reserves, continuing a pattern of consistent monthly accumulation over the past 18 months. China`s total certified gold reserves now exceed 2,322 tonnes, with a concurrent surge in Chinese gold ETF inflows. Strategic analysts view China`s accumulation as a deliberate diversification away from US dollar-denominated assets, particularly in light of evolving geopolitical and sanctions risk.

Hong Kong Develops New Gold Clearing System

Hong Kong is developing a new international gold clearing and settlement system designed to improve the efficiency of precious metals transactions between Asian and global markets. Analysts believe this infrastructure investment has the potential to increase gold trading volumes in Asia, accelerate execution speed, and enhance China`s influence in international gold price discovery. This initiative underscores the growing importance of Asia`s role in global gold market structure.

Central Bank Demand: The Structural Pillar

Central bank demand for gold is widely expected to intensify during the second half of 2026, with some analysts suggesting that purchases could double relative to first-half levels. J.P. Morgan`s Global Research division forecasts that central bank and investor demand for gold will average approximately 585 tonnes per quarter during 2026, continuing a trend that has seen more than 1,000 tonnes of annual central bank purchases for three consecutive years. This structural demand has fundamentally transformed the gold market and is cited by analysts as evidence that gold has graduated from its traditional role as a mere inflation hedge to a recognized strategic reserve asset on the balance sheets of sovereign institutions.

The `In Gold We Trust` 2026 report maintains a long-term constructive outlook for gold, supported by rising global government debt, inflation fears, persistent geopolitical tensions, ongoing de-dollarization trends, and waning confidence in fiat currencies. The long-term structural demand outlook is considered robust for years to come.

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Weekly Outlook: May 25–31, 2026

Price Range and Key Scenarios

Gold futures are currently trading at approximately $4,561 per ounce as of May 25, 2026. For the coming week, forecasts indicate a mixed to mildly bearish near-term bias, with algorithmic models projecting a potential decline of approximately 0.89%, bringing prices toward $4,465 per ounce by May 30, 2026. The 52-week price range for gold futures spans from $3,123.30 to $5,626.80, underscoring the magnitude of the bull run and the potential volatility ahead.

Base-case upside: A renewed bout of geopolitical escalation in the Middle East, further weakening of the US dollar, or evidence of disinflation progress that reopens rate-cut expectations could push gold back toward the $4,645–$4,760 range. Downside scenario: Continued hawkish Fed messaging combined with positive US economic data and any diplomatic de-escalation with Iran could extend the corrective move toward $4,441–$4,376.

Gold ETF Flows: By Region.

In last week’s Gold ETF data, selling of more than 8.50 tonnes was witnessed. North America and Asia each recorded selling of around 4 tonnes, while Europe continued to show mild buying of nearly 1 tonne. Looking closely at the ETF data, flows have remained slightly weak over the past 3–4 weeks, which is increasing concerns among traders and investors.

Key Events to Monitor

Investors should closely monitor the following catalysts during the week of May 25–31, 2026: (1) Any developments in US-Iran diplomatic talks or military activity near the Strait of Hormuz; (2) Federal Reserve speaker appearances or commentary following the April FOMC minutes; (3) US dollar index movement and Treasury yield trends; (4) Indian gold import data and market response to the May 13 duty hike; (5) Any updates from the World Gold Council or central banks regarding reserve accumulation or policy changes.

Longer-Term Structural View

Despite near-term volatility, the structural bull market thesis for gold remains intact. Commerzbank and Citi Research both target $5,000 per ounce for year-end 2026. J.P. Morgan projects gold moving toward $5,000 per ounce by Q4 2026, with $6,000 per ounce achievable over the medium term. The consensus among major financial institutions, as captured in a Reuters poll of 31 analysts, places the 2026 median gold price at $4,916 per ounce. Westpac projects a stable range of $4,500–$5,000 through 2030, viewing $4,500 as a new structural support level. Longer-term forecasts through 2030 point to prices in the $6,492–$8,357 range, driven by continued central bank demand, de-dollarization, inflationary expectations, and geopolitical risk premiums.

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Technical View

COMEX Gold

COMEX Gold is currently trading near a significant support zone around $4500-$4450, making this a critical level for near-term directional cues. A sustained break below the $4450 support level could trigger fresh downside momentum, where traders may consider short positions with a stop loss at

$4580, targeting a potential decline toward the $4370-$4300 zone. For risk-tolerant traders, a speculative buy setup may be considered around the $4520-$4530 level, with a strict stop loss below $4450.

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MCX Gold

MCX Gold is currently trading near a major support zone between 157500–155000, while resistance is placed around 159500–161000, making this range crucial for short-term market direction.

Bullion traders are advised to wait before initiating fresh buying positions, with preferred buying interest expected near the 154000 level on sharp declines. Traders holding previous short positions should continue maintaining a stop loss above 161000.

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