Bloomberg News — On August 13, spot gold surged to a two-month high of $4,449 before sharply retracing, closing down 1.3% at around $4,345. During the COMEX session, gold briefly touched the strong resistance level of $4,500, triggering profit-taking and weighing on spot gold performance. U.S. July PPI came in flat, reducing market expectations for a Fed rate hike in September to 34%. However, ongoing geopolitical tensions in the Strait of Hormuz continue to introduce inflationary uncertainty. Amid this tug-of-war between bulls and bears, gold prices are expected to trade sideways in the short term within the $4,300–$4,500 range, with central bank buying providing long-term floor support.
CoinMarketCap APP reports — On Thursday, August 13, a dramatic "rally-and-reversal" move unfolded. Spot gold surged strongly amid multiple bullish catalysts, briefly reaching a two-month high. However, just as the market anticipated a breakthrough above the $4,500 mark, massive profit-taking sell-offs swiftly reversed all gains. Cooling inflation data, shifting expectations around the Federal Reserve rate hikes, and geopolitical tensions in the Strait of Hormuz — three powerful forces are driving an intense battle between bulls and bears in the gold market.
On August 13, spot gold prices experienced a dramatic day. During trading, gold prices rose to a peak of $4,449.39 per ounce, the highest level since June 5. Prior to this, gold had been strengthening for several consecutive days, supported by the modest rise in the U.S. U.S. July Consumer Price Index; COMEX gold futures even surged past $4,500 per ounce to $4,509.10. However, just as bullish traders celebrated, market sentiment reversed sharply—spot gold then plunged significantly, closing down 1.3% at $4,350.88 per ounce, with an intraday low of $4,343.79, while COMEX gold futures settled near $4,407 per ounce. Notably, on Wednesday (August 12), COMEX gold futures also reached $4,502 but closed near $4,469.
StoneX senior market strategist Bob Haberkorn pinpointed the core issue: “$4,500 is a significant resistance level for gold. We’ve touched this level twice, and each time gold has pulled back from it; currently, traders are feeling quite nervous as the price approaches the $4,500 mark.” The repeated failure to break through this key psychological level, combined with the substantial gains gold has already accumulated in the short term, has triggered a wave of profit-taking selling pressure, pushing gold into a range-bound oscillation pattern.
Looking at a longer time horizon, the gold market in 2026 has been highly volatile. At the beginning of the year, spot gold surged to a historical peak of $5,596.33 per ounce, followed by a prolonged correction, with a intraday low of $3,943.65 per ounce on June 30, representing a drawdown of approximately 29.53% from the yearly high. The strong rebound since August is merely a sharp rally within this extended adjustment phase, while the repeated rejection at the $4,500 level clearly illustrates the intense battle between bulls and bears in this region.
The core driver of this gold price rebound is the moderate performance of U.S. inflation data and the resulting cooling of expectations for Federal Reserve rate hikes. The U.S. Consumer Price Index for July, released on August 12, showed a year-over-year increase of 3.4%, below June’s 3.5% and in line with economists’ expectations. Shortly thereafter, on August 13, the U.S. Department of Labor reported that the July Producer Price Index remained flat month-over-month, also below the market expectation of a 0.2% rise. The consecutive inflation reports both point to easing price pressures, significantly weakening market bets on a Federal Reserve rate hike in September.
According to the CME FedWatch tool, market expectations for a rate hike at the September meeting have fallen to 34% following the PPI data release, down from 55% a week earlier. Federal funds futures indicate that traders now expect approximately 23 basis points of tightening by year-end, compared to 27 basis points projected on Wednesday. The bond market has corroborated this trend—the yield on U.S. two-year Treasuries dropped to its lowest level since mid-July, while the 10-year yield fell 5.3 basis points to 4.639%.
Stephen Brown, Chief North America Economist at Capital Economics, clearly stated: "It now appears that the likelihood of the FOMC raising rates as early as September has significantly decreased." However, not everyone is so optimistic. Stephen Stanley, Chief Economist at Spain's Santander Bank, believes that if core PCE rises by 0.25% month-over-month in July, "this would essentially constitute sufficient justification for a September rate hike." Bank of America has even reaffirmed its aggressive forecast of three rate hikes this year in August.
More critically, divisions within the Federal Reserve are deepening. On August 10, Cleveland Fed President Harker explicitly stated that current inflation has not yet returned to the target level, and the Fed may need to implement multiple rate hikes. She bluntly noted that a 25-basis-point increase “would not have a significant impact on the economy,” and the current interest rate range of 3.5%–3.75% has not substantially constrained economic activity. At the July Fed meeting, Harker was one of the three officials who voted against maintaining rates unchanged. A journalist known as the “Fed’s messenger” pointed out that this marks the first time since 2016 that the Fed has seen three identical dissenting votes on the same policy decision.
The high uncertainty of this policy path is precisely the root cause of the sharp volatility in the gold market. On one hand, cooling inflation has reduced the urgency of rate hikes, benefiting gold as a non-yielding asset; on the other hand, hawkish voices continue to echo, keeping the sword of Damocles of rate hikes hanging overhead.
If inflation data determines the short-term direction of gold, then the geopolitical situation in the Strait of Hormuz represents a deeper factor influencing gold price movements. Since the U.S. and Israel launched strikes against Iran on February 28, Tehran has effectively blockaded the Strait of Hormuz—through which one-fifth of the world’s oil and liquefied natural gas were previously transported. On August 13, Hossein Taeb, the newly appointed head of Iran’s Basij paramilitary organization, publicly declared that the Strait of Hormuz is “under Iranian control and management.” The Iranian Joint Military Command subsequently further stated that no vessel may pass through the Strait of Hormuz without Tehran’s approval.
The day before, U.S. President Trump claimed that the United States has "complete control" over this strategic waterway, reigniting tensions between the U.S. and Iran over control of the strait. In June, the two countries reached a temporary ceasefire agreement and called for the restoration of freedom of navigation, but the agreement collapsed weeks later, with both sides accusing each other of violations. An advisor to Iran’s Supreme Leader even bluntly stated that if Tehran’s conditions are not met, the strategy will be "offensive war."
The impact of this geopolitical storm on gold is far more complex than it appears on the surface. Traditional logic suggests that geopolitical conflicts support gold through safe-haven demand, but the transmission mechanism of this Middle East conflict is more subtle. As analysts have noted, the old transmission chain was “geopolitical conflict drives up oil prices—elevates inflation expectations—strengthens rate hike expectations—pressures gold prices”—meaning higher oil prices have become a headwind for gold. Glen Smith, Chief Investment Officer at GDS Wealth Management, stated bluntly: “The PPI data from Thursday alone won’t change the Fed’s decision-making logic, because the key to controlling inflation right now lies in resolving the Middle East situation or establishing oil pipelines to reduce dependence on the Strait of Hormuz—something the Fed has no influence over.”
Currently, the United States has deployed more than 20 warships in the Middle East, strictly enforcing blockades against Iran. U.S. oil prices have dropped to around $75 per barrel, easing domestic energy price pressures. However, Iran has elevated strait control to a national strategic level, having approved through parliament the "Strategic Action Plan for Ensuring the Security and Development of the Strait of Hormuz," transforming the strait issue from a battlefield concern into a long-term strategic arrangement. This means the stalemate in the strait is unlikely to be resolved in the short term, and geopolitical risk premiums will remain a significant component of gold pricing.
Despite short-term volatility, the medium- to long-term support for gold remains strong. The global central bank buying spree is far from over. According to data from the World Gold Council, global central banks net purchased 288.9 metric tons of gold in the second quarter of this year, a 411% increase quarter-over-quarter and a 62% increase year-over-year. As of the end of July, China’s central bank held 76.08 million troy ounces of gold reserves, an increase of 640,000 troy ounces from the end of June, marking its 21st consecutive month of gold accumulation. The Bank of Korea has also restarted gold purchases for the first time in 13 years. In July, global gold ETFs ended two consecutive months of outflows, recording a net inflow of 23 metric tons.
An institution's research report on August 12 clearly stated that the two narratives previously suppressing gold have been disproven: global liquidity has not truly entered a tightening cycle, and de-dollarization has not ended. The institution believes the gold bull market is far from over, and a new window to increase allocations has opened following the earlier correction, recommending continued overweight positioning in gold. Analysts also noted that central bank gold buying, the de-dollarization trend, and expectations of declining real U.S. Treasury yields form a "floor support" for gold prices, with Standard Chartered Bank expecting gold to potentially retest the $5,000 per ounce level.
A survey of 16 professional analysts by the London Bullion Market Association indicates that spot gold could trade near or above $4,500 per ounce by the end of 2026, with an average annual price forecast of $4,604 per ounce. Among the most bullish analysts, Julia Du from ICBC Standard Bank expects gold to reach $7,150 per ounce this year. However, significant market divergence remains: the LBMA survey shows a wide prediction range of $3,700, with the most pessimistic target at just $3,450 per ounce.
Analysts warn that if gold prices face resistance and retreat near $4,500 per ounce, the market is more likely to enter a trading range between $4,000 and $4,300. Technically, Bespoke Investment Group notes that gold has entered overbought territory; historical data shows that after such signals, gold prices have on average declined over the following week, month, and three months. Latest CFTC positioning data also shows that speculative net long positions in gold have risen to historically high levels, with long positions highly concentrated.
Looking back from mid-August 2026, gold is situated in an unprecedentedly complex pricing environment. Moderated inflation data has weakened expectations of rate hikes, providing upward momentum for gold prices; a strong resistance level at $4,500, combined with profit-taking selling pressure, forms a short-term ceiling; while the geopolitical stalemate in the Strait of Hormuz affects, at a deeper level, the trajectory of energy prices, inflation expectations, and Federal Reserve policy.
In the short term, gold prices are likely to continue oscillating within the range of $4,300 to $4,500, with bulls and bears still vying for control around the $4,500 level. In the medium to long term, structural factors such as ongoing central bank gold purchases, the de-dollarization process, and limited upside potential for real U.S. Treasury yields continue to provide strong fundamental support for gold prices. As analysts note, gold and silver prices are currently at a阶段性 bottom, and investors should closely monitor three key variables: geopolitical developments, inflation data, and Federal Reserve policy.
This trading day, the U.S. July monthly retail sales data, commonly known as the "恐怖数据" (Fear Data), will be released. Investors should pay close attention, especially as Fed rate hike expectations significantly impact gold prices.
(Spot gold daily chart, source: E-Hui-Tong)
At 07:51 Beijing Time, spot gold is trading at $4,360.21 per ounce.
I. Rally Fades: Gold Hits Two-Month High, Followed by "Long-Short Double Kill"
On August 13, spot gold prices experienced a dramatic day. During trading, gold prices rose to a peak of $4,449.39 per ounce, the highest level since June 5. Prior to this, gold had been strengthening for several consecutive days, supported by the modest rise in the U.S. U.S. July Consumer Price Index; COMEX gold futures even surged past $4,500 per ounce to $4,509.10. However, just as bullish traders celebrated, market sentiment reversed sharply—spot gold then plunged significantly, closing down 1.3% at $4,350.88 per ounce, with an intraday low of $4,343.79, while COMEX gold futures settled near $4,407 per ounce. Notably, on Wednesday (August 12), COMEX gold futures also reached $4,502 but closed near $4,469.
StoneX senior market strategist Bob Haberkorn pinpointed the core issue: “$4,500 is a significant resistance level for gold. We’ve touched this level twice, and each time gold has pulled back from it; currently, traders are feeling quite nervous as the price approaches the $4,500 mark.” The repeated failure to break through this key psychological level, combined with the substantial gains gold has already accumulated in the short term, has triggered a wave of profit-taking selling pressure, pushing gold into a range-bound oscillation pattern.
Looking at a longer time horizon, the gold market in 2026 has been highly volatile. At the beginning of the year, spot gold surged to a historical peak of $5,596.33 per ounce, followed by a prolonged correction, with a intraday low of $3,943.65 per ounce on June 30, representing a drawdown of approximately 29.53% from the yearly high. The strong rebound since August is merely a sharp rally within this extended adjustment phase, while the repeated rejection at the $4,500 level clearly illustrates the intense battle between bulls and bears in this region.
II. Cooling Inflation and Interest Rate Expectations: Market Dynamics Amid the Fed’s Dilemma
The core driver of this gold price rebound is the moderate performance of U.S. inflation data and the resulting cooling of expectations for Federal Reserve rate hikes. The U.S. Consumer Price Index for July, released on August 12, showed a year-over-year increase of 3.4%, below June’s 3.5% and in line with economists’ expectations. Shortly thereafter, on August 13, the U.S. Department of Labor reported that the July Producer Price Index remained flat month-over-month, also below the market expectation of a 0.2% rise. The consecutive inflation reports both point to easing price pressures, significantly weakening market bets on a Federal Reserve rate hike in September.
According to the CME FedWatch tool, market expectations for a rate hike at the September meeting have fallen to 34% following the PPI data release, down from 55% a week earlier. Federal funds futures indicate that traders now expect approximately 23 basis points of tightening by year-end, compared to 27 basis points projected on Wednesday. The bond market has corroborated this trend—the yield on U.S. two-year Treasuries dropped to its lowest level since mid-July, while the 10-year yield fell 5.3 basis points to 4.639%.
Stephen Brown, Chief North America Economist at Capital Economics, clearly stated: "It now appears that the likelihood of the FOMC raising rates as early as September has significantly decreased." However, not everyone is so optimistic. Stephen Stanley, Chief Economist at Spain's Santander Bank, believes that if core PCE rises by 0.25% month-over-month in July, "this would essentially constitute sufficient justification for a September rate hike." Bank of America has even reaffirmed its aggressive forecast of three rate hikes this year in August.
More critically, divisions within the Federal Reserve are deepening. On August 10, Cleveland Fed President Harker explicitly stated that current inflation has not yet returned to the target level, and the Fed may need to implement multiple rate hikes. She bluntly noted that a 25-basis-point increase “would not have a significant impact on the economy,” and the current interest rate range of 3.5%–3.75% has not substantially constrained economic activity. At the July Fed meeting, Harker was one of the three officials who voted against maintaining rates unchanged. A journalist known as the “Fed’s messenger” pointed out that this marks the first time since 2016 that the Fed has seen three identical dissenting votes on the same policy decision.
The high uncertainty of this policy path is precisely the root cause of the sharp volatility in the gold market. On one hand, cooling inflation has reduced the urgency of rate hikes, benefiting gold as a non-yielding asset; on the other hand, hawkish voices continue to echo, keeping the sword of Damocles of rate hikes hanging overhead.
Three: The Hormuz Strait — The "Energy-Inflation-Gold" Transmission Chain Amid Geopolitical Storms
If inflation data determines the short-term direction of gold, then the geopolitical situation in the Strait of Hormuz represents a deeper factor influencing gold price movements. Since the U.S. and Israel launched strikes against Iran on February 28, Tehran has effectively blockaded the Strait of Hormuz—through which one-fifth of the world’s oil and liquefied natural gas were previously transported. On August 13, Hossein Taeb, the newly appointed head of Iran’s Basij paramilitary organization, publicly declared that the Strait of Hormuz is “under Iranian control and management.” The Iranian Joint Military Command subsequently further stated that no vessel may pass through the Strait of Hormuz without Tehran’s approval.
The day before, U.S. President Trump claimed that the United States has "complete control" over this strategic waterway, reigniting tensions between the U.S. and Iran over control of the strait. In June, the two countries reached a temporary ceasefire agreement and called for the restoration of freedom of navigation, but the agreement collapsed weeks later, with both sides accusing each other of violations. An advisor to Iran’s Supreme Leader even bluntly stated that if Tehran’s conditions are not met, the strategy will be "offensive war."
The impact of this geopolitical storm on gold is far more complex than it appears on the surface. Traditional logic suggests that geopolitical conflicts support gold through safe-haven demand, but the transmission mechanism of this Middle East conflict is more subtle. As analysts have noted, the old transmission chain was “geopolitical conflict drives up oil prices—elevates inflation expectations—strengthens rate hike expectations—pressures gold prices”—meaning higher oil prices have become a headwind for gold. Glen Smith, Chief Investment Officer at GDS Wealth Management, stated bluntly: “The PPI data from Thursday alone won’t change the Fed’s decision-making logic, because the key to controlling inflation right now lies in resolving the Middle East situation or establishing oil pipelines to reduce dependence on the Strait of Hormuz—something the Fed has no influence over.”
Currently, the United States has deployed more than 20 warships in the Middle East, strictly enforcing blockades against Iran. U.S. oil prices have dropped to around $75 per barrel, easing domestic energy price pressures. However, Iran has elevated strait control to a national strategic level, having approved through parliament the "Strategic Action Plan for Ensuring the Security and Development of the Strait of Hormuz," transforming the strait issue from a battlefield concern into a long-term strategic arrangement. This means the stalemate in the strait is unlikely to be resolved in the short term, and geopolitical risk premiums will remain a significant component of gold pricing.
IV. Long-term fundamentals unchanged: Structural support from central bank gold buying and de-dollarization
Despite short-term volatility, the medium- to long-term support for gold remains strong. The global central bank buying spree is far from over. According to data from the World Gold Council, global central banks net purchased 288.9 metric tons of gold in the second quarter of this year, a 411% increase quarter-over-quarter and a 62% increase year-over-year. As of the end of July, China’s central bank held 76.08 million troy ounces of gold reserves, an increase of 640,000 troy ounces from the end of June, marking its 21st consecutive month of gold accumulation. The Bank of Korea has also restarted gold purchases for the first time in 13 years. In July, global gold ETFs ended two consecutive months of outflows, recording a net inflow of 23 metric tons.
An institution's research report on August 12 clearly stated that the two narratives previously suppressing gold have been disproven: global liquidity has not truly entered a tightening cycle, and de-dollarization has not ended. The institution believes the gold bull market is far from over, and a new window to increase allocations has opened following the earlier correction, recommending continued overweight positioning in gold. Analysts also noted that central bank gold buying, the de-dollarization trend, and expectations of declining real U.S. Treasury yields form a "floor support" for gold prices, with Standard Chartered Bank expecting gold to potentially retest the $5,000 per ounce level.
A survey of 16 professional analysts by the London Bullion Market Association indicates that spot gold could trade near or above $4,500 per ounce by the end of 2026, with an average annual price forecast of $4,604 per ounce. Among the most bullish analysts, Julia Du from ICBC Standard Bank expects gold to reach $7,150 per ounce this year. However, significant market divergence remains: the LBMA survey shows a wide prediction range of $3,700, with the most pessimistic target at just $3,450 per ounce.
Analysts warn that if gold prices face resistance and retreat near $4,500 per ounce, the market is more likely to enter a trading range between $4,000 and $4,300. Technically, Bespoke Investment Group notes that gold has entered overbought territory; historical data shows that after such signals, gold prices have on average declined over the following week, month, and three months. Latest CFTC positioning data also shows that speculative net long positions in gold have risen to historically high levels, with long positions highly concentrated.
Conclusion: The Direction of Gold Under the Influence of Three Forces
Looking back from mid-August 2026, gold is situated in an unprecedentedly complex pricing environment. Moderated inflation data has weakened expectations of rate hikes, providing upward momentum for gold prices; a strong resistance level at $4,500, combined with profit-taking selling pressure, forms a short-term ceiling; while the geopolitical stalemate in the Strait of Hormuz affects, at a deeper level, the trajectory of energy prices, inflation expectations, and Federal Reserve policy.
In the short term, gold prices are likely to continue oscillating within the range of $4,300 to $4,500, with bulls and bears still vying for control around the $4,500 level. In the medium to long term, structural factors such as ongoing central bank gold purchases, the de-dollarization process, and limited upside potential for real U.S. Treasury yields continue to provide strong fundamental support for gold prices. As analysts note, gold and silver prices are currently at a阶段性 bottom, and investors should closely monitor three key variables: geopolitical developments, inflation data, and Federal Reserve policy.
This trading day, the U.S. July monthly retail sales data, commonly known as the "恐怖数据" (Fear Data), will be released. Investors should pay close attention, especially as Fed rate hike expectations significantly impact gold prices.
(Spot gold daily chart, source: E-Hui-Tong)
At 07:51 Beijing Time, spot gold is trading at $4,360.21 per ounce.