Gold Hits Record Highs as Central Banks Accelerate Buying and ETF Inflows Surge

Remy: Gold isn't just holding its ground in 2026, it's rewriting the record books. Now, the precious metal rallied sharply to kick off 2026, hitting new all time highs. And that rally is being driven by supportive macro trends as well as strong options. Activity and central banks appear to be accelerating bullion purchases as a hedge against a fracturing dollar based payment architecture. Meanwhile, global gold ETFs just saw their strongest month in history, pulling in a staggering $19 billion in January alone. And this morning we are looking at gold prices holding above the 5000 level. And joining me here at the New York Stock Exchange is Joe Cavatoni, senior market strategist and head of public policy for the U.S. at the World Gold Council. Joe, great to have you here. Thank you so much for joining me.

Joe: Great to be back. Good to see you.

Remy: Well, when we hone in on gold within the precious metals market, we are looking at it shining brightly. So tell us what you think is behind the games and why these all time record highs.

Joe: So 2025 and heading into 2026 have seen prices that we've never seen, just to put it into context. In January we saw 12 out of 20 trading days hit record highs. That was probably a little bit more accelerated than we were comfortable and often see. But what's behind it is pretty simple. Risk and uncertainty is on the minds of every investor, and questions around economic future of not only the US, but just sovereign nations, their ability to sustain debt and support fiat currencies. So you're seeing investors and you're seeing central banks, as you mentioned, really taking a look at how do I diversify, how do I manage risk and how do I hedge portfolios where I'm chasing return but needing certainty in my portfolio. And that's really been giving the eastern investor and the Western investor a lot of motivation to have gold in their portfolio.

Remy: Yeah. So I do want you to break this down when it comes to central bank buying of gold, what is different now compared to previous years.

Joe: So where we have seen a significant difference now, we've been on a 16 year trend of net buying by central banks. But the big difference has been the pace with which they've been choosing to pick up gold as a component of official reserves in their portfolio. We've seen near record or record level flows of 1000 tonnes over the last three years, 2025. We saw a little bit of a slowdown in that, but that's been met with these higher prices. So the speed with which they're accumulating has slowed a bit. The big difference here is that pace and the viable alternative, they have to dollar and dollar based assets. So we're not saying that we're seeing this aggressive unwind of those assets. They're just looking to complement them. And again with risk in mind not only internationally and globally for trade purposes, but also onshore. When they look at their own concerns about inflation, supporting their own fiat currencies That's what's really different this time. Big moves, emerging market central banks making the move in the Gulf.

Remy: And Joe, I do want you to expand on the role of currencies here. It's hard to believe that we're only in month two of 2026, given all that has happened so far on the fundamental and the macro front. But given where the US currency is now, how do you see this affecting gold?

Joe: So people are looking at the dollar often as that harbor for safety, but also a gauge of economic development and strength, a weakness of U.S. economy. And they're looking at it as a signal, one of many signals that are moving the gold price. And I think they're looking at it in the context of saying, do I have the appropriate way to run my portfolio? it set up in the right way? Am I getting the yields I need? Am I getting the returns I need, and what am I going to see? And how am I going to feel if things are starting to weaken? And I also think that this is a big discussion we're leading to around the value of fiat currencies. Can the debt levels that are outstanding be sustained by these countries, not only the US but other countries? And is it viable or are we going to see a weakening in those overall currencies simply because of that natural fiat currency devaluation and inflationary times?

Remy: And speaking of which, Joe, of course we're paying attention to what's happening around the globe, not just in terms of geopolitics, but when we're thinking about central bank buying as well as seasonality. The Lunar New Year is here. And so I do want to get your take on what's happening in China and gold. What's the relationship right now?

Joe: So China, for us, we see that as one of the most significant markets for gold there, traditionally one of the largest markets for consumer gold in the form of jewelry, but increasingly so in the form of investment. You know, we've seen more flows into Asian ETFs this year than we've seen into the Americas, which is a big surprise but exciting. China is leading the pack. They have a growing and sophisticated investment market, which includes insurance companies piloting gold in their portfolios, but also retail investors and consumers buying gold not only in the traditional formats but in the format of financial instruments So it's a growing market. But when the Lunar New Year comes around, we often see price support wane a little bit. It's such a significant mover and an impact on the price. You just have to be aware of it. Not a problem, just something to be aware of.

Remy: Yeah. And before we move away from China, there are a lot of anticipation as well as expectations as we head into the April summit between Trump and XI Jinping. So do you think that's already priced in when we're talking about gold?

Joe: I don't think it is. Sorry to cut in on you, but I think that that's such a good point to make sure people pay attention to how that meeting goes. Well, if it happens, when it happens and how it goes could be very significant. Not just for gold, but just how people are viewing risk and uncertainty. Will we land a comfortable situation between the U.S. and China? Will this change trade relations? Will it change the dynamic and the rhetoric? That could be a headwind if we start to see some of that fade off in terms of that risk, but it could also be the other way around. So we're watching that with bated breath.

Remy: Yeah. And speaking of risk and uncertainty, that is something that we've had plenty of so far in 2026. So that is an important point you made here. So finally, before I let you go and before you head into the holiday weekend, I do want to ask you about the digitization of gold. Sure. So for our viewers out there who may not be familiar in terms of what this actually means. Break it down for us.

Joe: So I think it's important for everybody to understand that you've got access to gold in many different formats, and that includes digital forms of it. Tokenization. And actually where we're spending our time in our energy. We love the idea that tokenization gives people a democratized and additional democratized mechanism to get access to gold. where we're spending our effort is working on the infrastructure of the gold market. So, you know, there's lots of different formats of gold, and we're working to work with the industry to harmonize those, bring them in a format known as the pooled gold interest, which will give us a much better wholesale market that can actually be easier to access through digitization. I would encourage people to take a look at the work we're doing on it. You know, our plans include a pilot program with the industry that we're working to get up and running over the course of this year, and actually really moving to get gold as a better utility in the market, collateral terms, better financing arrangements for it, and actually giving people a better infrastructure that then all of those formats and those tech companies that want to keep giving digital access to gold, they have a better infrastructure to work with. So it's really exciting. We're part of the whole wave of technology and development, and where we're spending our energy is in that infrastructure. It's very exciting stuff.

Remy: Well, Joe, a lot to keep our eyes on as we head into the rest of the series. So thank you so much for joining us as we kick off Q1.

Joe: Thanks for having me.

Remy: Thank you.