CHINESE BUYING DRIVING GOLD HIGHER

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During U.S. trading last Wednesday, October 14th, the Gold price reached a low of $4,065 per ounce. When the market opened in China the following morning, it quickly rallied above $4,150 per ounce, and that demand remained strong as markets opened around the world.

Why? Because I believe the Chinese central bank (PBOC) becomes an aggressive buyer when prices drop below a certain level. I believe that price level is 28,000 Yuan. The current China/U.S. currency exchange rate is 6.69 Yuan to the Dollar, which means 28,000 Yuan is equal to $4,185. Right now, that is the price level where demand seems to drop in many of the world’s largest precious metals exchanges.

The official Chinese central bank announced that it purchased 23 tons of Gold in September and a record 103 tons of Gold in the 3rd quarter of 2026. China spent a record $158.8 billion importing 1,000 to 1,200 tons of Gold in the first eight months of 2026, surpassing the entire year of 2025 (which totaled 866–886 tons and $96.5 billion). Many commodity analysts believe the Chinese understate their Gold purchases. Looking at the recent Chinese buying, October should be another record month.

Where is this Gold coming from?

Hong Kong imported a record 112.7 tons of Russian Gold through the first seven months of 2026. Hong Kong imported 92.1 tons of Russian Gold throughout 2025. That compares with just 3.3 tons in 2021, the year before Russia invaded Ukraine. According to CNBC, Russian bullion accounted for only 15 percent of Hong Kong’s non-monetary Gold imports in the first seven months of this year. That was up from just 0.6 percent in 2021.

Before the war in Ukraine, Russia sold its Gold in London. London is the world’s largest market for physical Gold trading, with daily transactions worth $190 billion. The London vaults hold Gold worth about $1.4 trillion. However, the Hong Kong and Shanghai exchanges are quickly catching up.

Geopolitical tensions generally support the Gold price by increasing demand for safe-haven assets. However, the recent CPI data shows a different dynamic, as higher oil and grocery prices raise investors’ concerns about higher inflation and further interest rate increases by the Fed.

Looking at the Chinese Gold support level, I now understand why many financial analysts believe that higher interest rates and U.S. Dollar headwinds will keep Gold from moving above $4,200 per ounce. I believe Gold will trade between $4,000 and $4,200 until some bullish news gives it the momentum to break out.

The Treasury named Judy Shelton a counselor to Treasury Secretary Scott Bessent on October 9th. Shelton has been a strong advocate of Gold, and she has proposed 50-year Treasury bonds redeemable in dollars or Gold at maturity, which she believes would lower borrowing costs. If these bonds were redeemable in Gold, the Gold price would need to be revalued. That would be a very credible and highly profitable move for the U.S. Treasury.

The U.S. Treasury is currently holding 261.5 million ounces of Gold at the statutory price of $42.22 an ounce, currently valued at $11 billion. If Congress approves, this Gold could be revalued to the current market price, increasing its value to over $1 trillion. Something worth thinking about.

Gold closed last Friday at $4,165 per ounce, down $25 for the week.

Key Economic data to watch this week:

• October 19th, Monday:
• October 20th, Tuesday: September Housing Starts, September Pending Home Sales
• October 21st, Wednesday:
• October 22nd, Thursday: U.S. Weekly Jobless Claims
• October 23rd, Friday:

Today: Last night in overseas trading, the Gold price reached $4,188 per ounce during trading in China. However, as trading moved to London and the U.S., the price dropped below $4,150 per ounce.

Last week wasn’t pretty for Silver investors, with Silver testing the 2026 low of $55.25 per ounce. The Silver/Gold ratio made a new 2026 high last Friday of 73-to-1. I believe Silver will move back above the key $60 per ounce level when Gold firmly breaks back above $4,200 per ounce.

Silver closed Friday at $57 per ounce, down $3.74 for the week.

The recent drop in the Silver price was driven by the same factors that caused Gold to test key support levels last Thursday. However, Silver doesn’t have the central bank buying that Gold has. While Gold attracts strong demand from international investors and central banks as a financial safe haven, Silver’s larger industrial-demand component faces pressure from substitution and reduced Silver usage in solar applications, electrical and thermal conductivity applications, and coinage.

Today: Silver moved higher at the opening of Chinese trading last night, reaching a high of $57.92 per ounce. Like Gold, as Silver trading moved to London and the U.S., the price dropped $0.80 per ounce to $57.10.

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Barry Stuppler has been a professional numismatist for over 60 years and is considered one the nation’s foremost experts in rare coins and precious metals. Mr. Stuppler is a past President of the American Numismatic Association (ANA) and Professional Numismatists Guild (PNG). He is currently chairman of the Federal and California State Gold & Silver Political Action Committees, and president of the
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