$4,400: Gold Reclaims Lost Ground, But Will It Last?

Gold has rebounded over 10% in six weeks to reclaim $4,400 after plummeting nearly 30% from its January peak of $5,600. The dramatic swing has left investors in different positions, with some holding onto recovering gains and others wondering if it's too late to get back in.

The immediate trigger for the rally is the cooling labor market in the US, which reduced the odds of further rate hikes. This led to a sharp pullback in the 2-year Treasury yield, making gold more attractive as a zero-yield asset.

Central banks have been permanent buyers of gold, with China's reserves rising for the 21st consecutive month through July and globally adding a net 289 tonnes in Q2. This structural shift has put a floor under prices even during selloffs.