- Gold Price Movement: In July 2025, gold prices rose by 0.3%, closing at US$3,299 per ounce, supported by tariff-led inflation expectations and geopolitical risks
- ETF Inflows: Global gold ETF inflows reached US$3.2 billion (23 tonnes), with North America and Europe leading contributions
- Market Dynamics: Weak August labour data suggests potential easing of policy rates, which may lower real yields and further boost gold prices
Harare- Gold prices rose 0.3% in July 2025, closing at US$3,299 per ounce, driven by tariff-led inflation expectations and geopolitical risks, per the Gold Return Attribution Model (GRAM).
A stronger US dollar limited gains across major currencies, yet gold’s year-to-date return stands at an impressive 26%. Momentum factors also supported performance, despite the dollar’s drag.
Global gold ETF inflows reached US$3.2 billion (23 tonnes), with North America (US$1.4 billion, 12 tonnes) and Europe (US$1.7 billion, 11 tonnes) leading, while Asia added US$0.1 billion (0.8 tonnes).
Minor outflows of US$0.1 billion (1 tonne) occurred elsewhere.
COMEX net longs grew post-April lows, but a price-positioning gap, tied to tariff fears, suggests rising positions rather than falling prices, supported by fundamentals like a weaker dollar and elevated risks.
Despite gold’s decoupling from inflation-linked bond yields (TIPs), driven by central banks and emerging market demand, US futures investors remain yield-sensitive. Weak August labour data hints at easing policy rates, potentially lowering real yields and boosting gold.
Swap rates also signal rising inflation fears, which could further support prices.
COMEX and ETF investors have room to increase positions, historically sensitive to yield shifts (100 basis points equating to ~20% positioning changes).
A softer dollar, lower rates, and persistent risks could drive further inflows, bolstering gold prices if central bank buying slows.
While near-term dollar strength poses risks, gold’s outlook remains positive.
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