Gold Rallies Back After Down Week

Gold markets remained highly volatile over the past week, shaped by shifting macroeconomic expectations, strong investor flows, and continued geopolitical uncertainty. Prices initially struggled following the sharp correction seen after January’s record highs, but sentiment stabilized as investors stepped back into the market and safe-haven demand returned. 

One of the most significant developments was the continued strength in investment demand. Global gold-backed ETFs attracted roughly US$19 billion in January, the strongest monthly inflow on record, pushing total assets under management to about US$669 billion and collective holdings to new all-time highs. North America and Asia led to the buying, while European funds also saw steady inflows amid ongoing trade tensions and political uncertainty. Even during the recent price pullback, investors in several regions used lower prices to increase exposure, highlighting persistent long-term confidence in gold. 

Price action during the week reflected this mixed but resilient sentiment. Gold rebounded to trade back above the US$5,000 per ounce level after earlier volatility, supported by expectations that interest rates could ease later in the year and by continued uncertainty surrounding monetary policy and global growth. Silver also showed strong momentum, rising sharply during the week and continuing to exhibit greater volatility than gold, driven in part by speculative flows and its smaller market size. 

Broader financial markets provided an equally complex backdrop. Treasury yields were relatively stable; the US dollar fluctuated, and equity markets traded mixed as investors awaited key inflation and employment data. Expectations about Federal Reserve policy remain central to the outlook, with markets sensitive to any signs of slowing growth or persistent inflation. 

Overall, the past week reinforced gold’s role as both a hedge against uncertainty and a highly responsive asset to shifts in liquidity, interest rate expectations, and investor positioning.