Gold Demand Surges on ETF Inflows and Central Bank Buying. Forecast as of 05.09.2025
Gold ETF reserves have reached an all-time high in dollar terms, central banks are ramping up bar purchases, and tariff fears are sending the metal to the US. Let’s discuss it and make a trading plan for XAUUSD.
The article covers the following subjects:
Major Takeaways
- The metal is rising on tariff expectations.
- Geopolitics continues to support XAUUSD.
- Demand from ETFs and central banks remains strong.
- Consider building up long positions in gold opened from $3,400.
Weekly Fundamental Forecast for Gold
In 2025, gold looks like a spring: compressed for a long time, it has finally shot up. Investors believe that the XAUUSD rally is built on expectations of renewed Fed monetary easing in September. But if that were the case, the metal would have broken out of the $3,250–3,400 consolidation range a month earlier — after the July jobs report or Jerome Powell’s Jackson Hole speech. The real driver lies elsewhere.
The 33% XAUUSD rally since the start of the year, up to April’s highs, was fueled by fears of US tariffs on precious metal imports. After America’s Liberation Day, it became clear Donald Trump had no such plans. Tariffs on steel, aluminum, copper — yes. Gold — no. However, the United States Court of Appeals’ verdict revived old fears: if the White House cannot impose broad duties on all imports, specific goods could fall under attack. And they might run short.
Gold ETF reserves
Source: Bloomberg.
No surprise that the largest gold ETF, SPDR Gold Shares, took in $2.4 billion in a single week — the biggest capital inflow of any ETF. Since the start of the year, investors have poured $11 billion into it, compared with just $454 million in 2024. As a result, total reserves of gold funds have surged to a record in dollar terms.
Over the past three years, gold prices have more than doubled. The surge in XAUUSD coincided with the war in Ukraine, the freezing of Russia’s reserves, and a wave of dedollarization, diversification, and central bank gold buying. That’s why, after the April thaw in US-Russia relations, there were fears the geopolitical driver had been played out.
But much time has passed, and nothing has changed. The war goes on, while Donald Trump speaks of an economic war. Why shouldn’t XAUUSD rise further? Moreover, the East’s alignment under the leadership of China, Russia, and North Korea may further accelerate central bank gold buying.
Central bank gold purchases
Source: Bloomberg.
It’s not that Fed rate-cut expectations aren’t supporting gold. But in my view, September easing is already priced in. What matters more is the US shift toward fiscal dominance, with Trump replacing FOMC members with his own picks. According to Goldman Sachs, this could send XAUUSD as high as 5,000 — provided that 1% of the Treasury market capital shifts into gold.
Weekly Trading Plan for XAUUSD
In my view, gold’s fate will be decided by Washington, Moscow, central banks, and ETFs — not the US jobs report. Weak employment will allow traders to build up longs opened from $3,400 per ounce. Strong data will create opportunities to buy XAUUSD on pullbacks.
This forecast is based on the analysis of fundamental factors, including official statements from financial institutions and regulators, various geopolitical and economic developments, and statistical data. Historical market data are also considered.
Price chart of XAUUSD in real time mode
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