Gold hit a weekly high on Thursday, Oct. 16, after a volatile climb driven by official-sector buying.
Weekly price swings
On Oct. 14 the metal slipped, an $87 drop from the previous day’s level.
By the next morning it rebounded, gaining in a single session.
Spot had been around $4,158 on Oct. 13 before the recovery, leaving the week’s net move a modest dip followed by a steady climb.
Short pullbacks were quickly absorbed, indicating buyers were not waiting for a sell signal.
Official-sector buying drives demand
Data for September show the official sector bought about 63 tonnes, the most since Nov. 2024.
Central bank activity in China added 21 tonnes, its largest monthly purchase in three years.
August saw a net purchase of 39 tonnes, with cumulative buying through that month reaching 170 tonnes.
China contributed 20 tonnes in August, while Poland and Uzbekistan each added eight tonnes.
In the first half of 2026 official institutions amassed an estimated 345 tonnes, including 289 tonnes in Q2 alone.
The full-year forecast targets 720 tonnes of accumulation.
The breadth of participants, multiple countries over several months, suggests the forecast is realistic rather than aspirational.
Given the sustained pace, the market now rests on a structural floor that short-term traders often overlook.
Continuing this level of buying could keep the floor firm even if spot prices hover near recent lows.
Implications for market participants
Refiners and bullion dealers benefit from predictable demand, which helps maintain premiums and keeps fabrication orders steady.
The metal’s rise occurred while Europe’s luxury sector shed roughly $350 billion in market value, and LVMH missed its quarterly target.
Gold’s performance remains unrelated to handbag sales, showing its distinct market forces.
Outlook toward year-end
Nevertheless, the price remains about $40 below where it traded a year ago, showing that the rally is still recovering ground.
The key question for the closing months is whether official buying can sustain the forecasted pace, as that volume underpins the $4,100 support level.
