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WisdomTree
Gold Monthly
June 2025
Nitesh Shah
Head of Commodities and Macroeconomic Research, WisdomTree Europe
Nitesh Shah is a seasoned financial professional with over 24 years of experience in research and investment strategy. As Head of Commodities & Macroeconomic Research at WisdomTree Europe, he leads market analysis and insights across asset classes, with a focus on commodities and exchange-traded products. Previously, he held roles at Moody’s, HSBC Investment Bank, The Pension Protection Fund, and Decision Economics, building expertise in market analysis and strategy.
Nitesh earned a master’s degree in International Economics and Finance from Brandeis University and a bachelor's in Economics from the London School of Economics. His insights are frequently featured in financial media, and he is a sought-after speaker at industry events. He also hosts the ‘Commodity Exchange’ podcast, where he discusses trends shaping global markets. Passionate about guiding investors, Nitesh provides actionable insights to help them navigate complex financial landscapes.
Gold Monthly: Middle East tensions take centre stage
Missile exchanges between Israel and Iran have sharply escalated geopolitical tensions in the Middle East, providing renewed support for gold prices. Historically, gold tends to rise during periods of heightened geopolitical stress. As of 19 June 2025, U.S. President Trump is reportedly weighing whether to join military actions against Iran. If that decision materialises, gold could potentially gain further in the short term.
Although gold has not returned to its intraday high of $3,500/oz reached on 22 April 2025, it touched $3,451/oz on 16 June following the news of Israeli missile strikes, reflecting market sensitivity to geopolitical developments.
While geopolitical risks are now dominating headlines, trade tensions continue to play a significant role in supporting gold prices. On 4 June, President Trump doubled tariffs on steel and aluminium to 50%, raising the stakes in the ongoing trade conflicts. However, a temporary reprieve came on 12 June when a ‘trade truce’ between the U.S. and China reduced tariffs on Chinese goods to 55%, down from 145% in April. Gold prices dipped on the news. Still, looming deadlines — such as the 90-day pause on ‘Liberation Day’ tariffs ending on 8 July, and the 9 July U.S.–EU deadline to avert a 50% tariff on EU imports — suggest persistent trade risks that could continue to bolster gold.
Despite these supportive factors, gold has seen some constraint from the Federal Reserve’s (Fed) current stance. The Fed has signalled no urgency in cutting interest rates and has scaled back expectations for rate cuts in 2026, as indicated by its latest ‘dot plot’ projections.
Meanwhile, a weakening U.S. dollar has underpinned gold prices. Investor concerns over mounting government debt and the sustainability of fiscal policy — exacerbated by unfunded tax cut proposals — have pressured the dollar. Trump's ‘One Big Beautiful Bill’ has passed the House and is under Senate debate, with lawmakers targeting 4 July for passage.
Figure 1: Gold and dollar
Central Banks and gold: confidence continues
The World Gold Council's annual survey of central banks, released this month, indicates growing optimism toward gold. An all-time high of 95% of central banks expect global gold reserves to increase. Additionally, 43% of respondents anticipate growth in their own reserves — another record. Notably, none of the central banks surveyed expect their gold holdings to decline.
Key motivations for continued accumulation include gold’s performance in crisis periods, its portfolio diversification benefits, and its role as an inflation hedge. Consistent with previous years, few respondents cited diversification away from the U.S. dollar as a reason — at least openly.
Figure 2: Central bank expectations on central bank gold holdings
Investor positioning and flows
Gold's net speculative positioning remains far from overstretched. In fact, positioning declined steadily from February until recently, with only modest rebuilding seen in the past fortnight.
Figure 3: Net speculative positioning in gold futures
Flows into gold exchange-traded products (ETPs), which had paused in mid-April, have resumed in June. However, holdings remain well below the 2022 peak.
Figure 4: Gold in exchange-traded products
China continues to buy gold
The People's Bank of China (PBoC) continued its gold buying streak in May, marking seven consecutive months of purchases. With 1.9 tonnes added in May, cumulative purchases in 2025 now stand at 16.8 tonnes.
Gold Focus launch
Metals Focus released its Gold Focus 2025 report on 5 June. The report, widely respected in the industry, forecasts:
- Net physical investment demand to grow by 2% year-over-year (from 1,191 tonnes in 2024 to 1,218 tonnes in 2025)
- Jewellery demand to fall by 16% (from 2,011 to 1,696 tonnes)
- ETP investment to rebound significantly to 500 tonnes (up from -7 tonnes in 2024), marking the strongest inflows since 2020
The publication offers comprehensive projections on mine supply, demand across major sectors, cost structures and more, making it a valuable reference for all things gold.