Gold Rallies as China and India Prices Signal Stronger Demand

AI desk brief

Gold and silver rallied in London as pricing signals from China and India pointed to stronger physical demand into Diwali, while softer US data and lower Treasury yields helped the rebound. Shanghai gold fell to a 10-week low beneath ¥890/g, but the stronger yuan gave importers a roughly $22/oz incentive versus typical levels; in India, dealers were charging about $5.50/oz above official import costs, according to WGC data.

The move coincided with a sharp swing in macro rates: US 10-year yields eased back to 5.10% after pending home sales fell 11.3% y/y, while the average 30-year mortgage rate rose to 7.40%, the highest since late 2023. WGC also said global gold ETF holdings rose 0.3% last week to a record 4,278 tonnes, with Asia-listed funds driving nearly one-fifth of the 3-month increase; Reuters added that India’s SEBI prompted some mutual funds to pause large new inflows into gold ETFs to curb bullion imports.