Gold Prices Rise Amid Central Bank Buying and 5% Treasury Yield

The price of gold rose to $4,379 an ounce early Monday as the US 10-year Treasury yield held at 5.00%. This pairing is key for investors, who typically view gold as a non-yielding asset that should perform poorly when yields are high.

However, buyers are now paying for reserve diversification and protection from policy shocks rather than income. Central banks bought a net 23 tonnes in July, with China and Poland purchasing 28 tonnes between them, while Russia and Turkey sold seven tonnes combined.

Central banks' reported buying is positive but trails last year's pace. Goldman Sachs estimates that they will average 50 tonnes monthly during 2026, which is higher than the current rate of about 19% below last year's 160 tonnes.

The next broad test arrives on September 30 when the US releases August personal-income and PCE inflation data, showing whether 5% yields remain gold's obstacle or become its inflation hedge.