Asian Nations Hoard Gold Amid Supply Tightening Trend

Gold-producing nations across Asia are adopting a new strategy: keeping more of their metal at home. This shift, driven by resource nationalism, includes boosting domestic refining, imposing export taxes, and increasing central bank purchases. The goal is to capture greater value from gold's recent rally, as London spot gold hit a record above $5,500 an ounce in January before settling above $4,000.

Laos, for instance, is refining its gold output domestically through the Lao Bullion Bank, established in 2024. The country produced around 12 tons in 2025 and estimates its reserves at 500 to 1,000 tons. Meanwhile, Indonesia, which mines over 100 tons annually, plans to tax gold exports by up to 15% starting in 2026. China, the largest producer, restricts gold exports and extended its central bank's net purchases to a record 22 months in August.

These actions could shrink the global supply of gold available internationally, affecting major refiners' ability to source the metal. While gold faces near-term pressure from rising long-term yields and expectations of further US rate hikes, the long-term trend suggests higher prices due to these supply constraints.

ANZ's Geullim Yum noted that the actions of producer countries could become another factor pushing gold prices higher over time. The trend highlights gold's appeal as a reserve asset amid waning confidence in the dollar and sanctions risk.