Crisis festival: Escape into the gold – continued price increase in sight

According to dealers and financial sectors, the almost unstoppable increase in the gold price will continue. The World Gold Council (WGC) in London predicts a further price increase in the second half of the year in its recent forecast, albeit easily slowed down. Last but not least, bridal couples all over the world have felt: gold has become so expensive that the worldwide demand from jewelry manufacturers has decreased significantly this year – from 435 tons in the first quarter to 356 tons in the second.

Central banks as price drivers

The price per troy ounce – 31.1 grams – is currently a good $ 3,300, almost twice as high as 2022. A decisive price drivers are the central banks of China and other countries that want to reduce dependence on the dollar and continuously increase their gold reserves. According to a recently published assessment by the US investment bank Goldman Sachs, the price could increase to $ 4,000 by mid-2026.

“As long as the central banks further increase their gold reserves, the gold price will not move south, but to the north,” says Michael Eubel, head of the precious metal business at BayernLB, the largest German gold dealer. “North” means increasing prices in the language of the financial scene, but the “south” falling. “The uncertainties in the world are increasing, gold has been liable for 5,000 years the Nimbus that you can also exchange it in times of crisis,” says Eubel.

“In recent years, the central banks have acquired around 1,000 tons of gold every year,” says Benjamin Summa, spokesman for the Pro Aurum retail house, also based in Munich. “A significant part of it was probably in China.” In addition to the central bank purchases, Summa’s assessment plays a role: geopolitical tensions, the expansive monetary policy of many central banks and fear of inflation.

China allegedly buys more than admitted

Since the turn of the century, China has almost changed its official gold reserves according to WGC data, from 395 tons to 2,292 tons at the end of the first quarter. This would make China’s national gold treasure seventh. However, a number of experts are convinced that the Beijinger leadership has actually increased its inventory much more.

“Can you believe the official statistics? No,” says Eubel. “I assume that the Chinese gold reserves are much higher. In my opinion, China acquired at least another 500 tons on the way to the second markets.” Apart from that, China is also the largest gold producer worldwide. “It is extremely little exported,” says the BayernLB Golde expert.

The motif: independence from the dollar

It is no secret that China’s communist party would rather see the dominance of the USA ended today than tomorrow. The corresponding gold reserves include the status of a world power. But China is by no means the only country that buys gold. “These states want to make themselves more independent of the US dollar and therefore increasingly rely on physical gold,” says Summa. This includes, for example, India, the United Arab Emirates or Qatar. However, this year is not the most active, but Poland, which, according to WGC, is at the top with over 48 tons so far. According to official figures, long Russia was the largest gold buyer, which has restricted his purchases since 2020.

The German gold reserve is becoming increasingly valuable

The Bundesbank as the owner of the world’s second largest gold treasure is one of the beneficiaries of development: According to the Bundesbank’s annual report, the German state gold was worth 270 billion euros at the end of 2024, thanks to the rapid price increase, that was 69 billion more than a year earlier. The basis was a kilo price of a good 80,700 euros. In the meantime, the price of a kilos has increased to around 92,600 euros. This corresponds to a further book gain of 40 billion, but it is only billed at the end of the year.

First in the nations ranking with the highest gold reserves, the United States is over 8,100 tons, followed by Germany. The Bundesbank did not buy but slightly reduced its reserve. In recent years, small quantities have gone to the Federal Ministry of Finance, which shapes and sells gold coins from it.

Part of the German gold is stored in New York – and should stay there

The state treasure is not completely stored in Germany: 1,236 tons are presumably the world’s largest safe at the Federal Reserve Bank in New York, another 405 tons are guarding the Bank of England in London. The two metropolises are the most important trading places for gold. “The aim is to be the aim of the targets of security and tradability in order to sell gold or exchange gold in foreign currencies,” says a Bundesbank spokesman. “The New York Fed is and remains an important storage point for our gold in this context.”

Nothing has changed since the re-election of US President Donald Trump. “We have no doubt that with the Fed New York we have a trustworthy, reliable partner in storing our gold stocks.”

Consequences for the marriage

Gold owners can be happy, but gold buyers have to dig deeper and deeper into their pockets. This does not only apply to investors. The increase in gold price from the capital market has consequences for jewelers all over the world and their customers. Sales have increased, although the shops do not fully pass on their higher purchasing costs to customers: “The prices have risen significantly, but not analogous to the gold price,” says Joachim Dünkelmann, the managing director of the Federal Association of Jewelers.

Among other things, this can be seen at weddings: According to the Federal Statistical Office, 416,324 couples in Germany were given the yes word, in 2024 it was only 349.221 due to the advancing aging of the population. Even before the rapid increase in gold prices, the average prices of wedding rings rose continuously, says Dünkelmann. “The declining number of marriages does not mean that the wedding ring industry makes lower sales.”

In any case, the German gold jewelry market flourishes despite increasing prices and demographic change. According to the Jewelier Association 2023 and 2024, record stalls were reached after a sales plate. “The luxury goods market apparently decoupled from the general buying mood and the crises of the world,” says Dünkelmann.