Gold hovered above $5,060 per ounce on Wednesday, maintaining levels near a two week high, as traders absorbed weaker United States economic data, steady central bank purchases, and ongoing geopolitical tensions.
The precious metal rose above $5,060 per ounce during Wednesday trading, supported by expectations of a more accommodative Federal Reserve (Fed) following soft United States economic indicators. Gold traded at $5,074.46 per ounce as of Monday, February 9, 2026, according to market data.
United States December retail sales came in below expectations, showing that consumer spending slowed. The Gross Domestic Product (GDP) control group slipped 0.1 percent whilst job openings fell to their lowest level since 2020. Private payroll growth undershot forecasts, collectively signalling cooling demand and easing inflation pressure.
Markets quickly adjusted, pricing in a higher probability of three Fed rate cuts this year, up from two just a week ago. Traders are now watching upcoming United States jobs and inflation reports for further signals on where monetary policy may head.
The People’s Bank of China (PBOC) extended its gold buying streak for the 15th consecutive month in January, data released on Saturday, February 7, 2026 showed. China’s gold holdings rose to 74.19 million fine troy ounces by the end of January, up from 74.15 million the previous month.
The value of China’s gold reserves increased to $369.58 billion at the end of January from $319.45 billion in December, according to the PBOC. The central bank added 40,000 troy ounces of gold in January, approximately 1.24 tons, continuing a buying programme that began in November 2024.
The PBOC had halted an 18 month long gold buying streak in May 2024 but resumed purchases six months later. Central bank purchases remain a key structural support for gold prices, with total global central bank purchases for 2025 projected to exceed 860 tons, according to the World Gold Council (WGC).
Geopolitical tension, particularly between the United States and Iran, also added support to gold prices, keeping safe haven demand steady. Despite tentative diplomatic progress, tensions persist, with Washington warning United States flagged vessels to stay away from Iranian waters.
Gold experienced significant volatility in January 2026, surging to a record near $5,600 per ounce before plunging sharply following the nomination of Kevin Warsh as the next Federal Reserve chair at the end of January. Prices fell as low as $4,403.24 per ounce on Monday, February 3, 2026, before recovering.
The move in long dated United States Treasuries has supported gold prices. The iShares 20 Plus Year Treasury Bond Exchange Traded Fund (ETF) climbed more than 2 percent over the past week as yields eased back toward the 4.1 percent level on the 10 year bond.
Markets currently price in at least two Fed rate cuts this year, keeping expectations for easier monetary policy broadly supportive for bullion. White House economic adviser Kevin Hassett noted on Monday that job growth is likely to slow in the coming months due to declining population.
Lower interest rates reduce the opportunity cost of holding non yielding assets such as gold, making the precious metal more attractive to investors. The Fed maintains its benchmark interest rate in the 4.25 to 4.50 percent range following a 25 basis point cut in December 2025.
China’s gold consumption dropped for a second consecutive year in 2025, declining 3.75 percent to 950 metric tons, according to the state backed China Gold Association. However, purchases of gold bars and coins, representing safe haven demand, jumped 35.14 percent in 2025 and account for more than half of total gold consumption.
Independent estimates from the WGC suggest that China’s actual gold holdings may be significantly higher than officially reported figures, with some analysts believing Beijing has been buying substantially more gold than disclosed.
