Gold market in August 2026

Gold surged 12.7% in August, touching a new record high.

Gold opened the month at SGD 166.82/g and closed at SGD 187.97/g — a +12.68% move. The monthly range ran from SGD 166.82/g to SGD 189.29/g (USD 4056.42/oz to USD 4602.89/oz on the international market).

Three drivers

Central banks kept buying at pace — Central bank gold purchases bounced back sharply in Q2 2026 to 289 tonnes — recovering from a quieter Q1 and returning to the elevated levels that have characterised buying over the past four years. When central banks accumulate gold, they reduce the amount available to the broader market, which tends to put upward pressure on prices over time. The People's Bank of China and the Reserve Bank of India have been among the most consistent buyers, adding gold to diversify away from US dollar reserves.

OTC and Asian buying filled the gap — As gold ETFs in North America faced outflows in Q2 — investors pulling back as US interest rate expectations shifted upward — demand in over-the-counter markets and across Asia quietly absorbed much of that slack. OTC gold trading happens directly between large institutions and wealthy buyers, largely outside the exchange-traded world, and can move significant volumes without making headlines. By August, that underlying demand had helped propel prices well above Q2 levels.

Jewellery buyers stepped back as prices climbed — Gold jewellery demand fell to its lowest quarterly volume since the pandemic in Q2, with consumers in price-sensitive markets like India and China pulling back as affordability thinned. Even so, total spending on gold jewellery rose 14% year-on-year to US$40 billion — meaning fewer grams were bought, but at much higher prices. The divergence between volume and value is a clear sign of how dramatically gold prices moved in the first half of 2026.

Did you know? — OTC gold market

When you hear that gold rose because of 'OTC buying', it refers to trades that happen directly between two parties — a central bank and a bullion bank, say, or a large family office and a dealer — rather than on a public exchange like the NYSE. There is no order book, no ticker, and often no public record of the size or price. Because these deals can involve hundreds of millions of dollars at a time, OTC flows can shift the gold price without most people noticing until after the fact. It is the part of the gold market that is largest by volume and least visible to everyday observers — which is exactly why analysts watch for it when trying to explain sudden price moves.

Things worth knowing

Record value, steadier volume — Total gold demand in the first half of 2026 reached a record value of US$380 billion, even though the volume of gold traded — 2,522 tonnes — rose only 2% compared to the same period last year. This gap between value and volume reflects the price surge rather than a dramatic increase in how much gold changed hands. It is a useful reminder that record-high headlines are often about price, not a sudden rush of new buyers.

Why recycling slowed down — When gold prices dipped quarter-on-quarter in Q2, recycling of old jewellery fell 6% year-on-year — people held on to their gold rather than selling it. This behaviour is well-documented: owners of physical gold tend to sell when prices are rising sharply, and hold when prices soften even slightly. Less recycled gold flowing back into the market means total supply stays tighter than mine production figures alone would suggest.

AI is quietly lifting gold demand — Gold used in technology edged up again in Q2, reaching 80 tonnes, as demand from the artificial intelligence industry offset weakness in conventional consumer electronics. Gold is used in connectors, circuit boards, and semiconductor components where reliability matters more than cost. As data centre buildouts accelerated globally through 2025 and 2026, that steady industrial floor under gold demand became a little more visible.