Review of Gold Market Performance and Key Views:
Last week, the gold market experienced a bottoming and recovery pattern amidst significant swings in macroeconomic expectations. London spot gold closed at $4,219 per ounce (down 2.5% week-on-week), while domestic AU9999 gold finished at 907 yuan per gram (down 6.5% week-on-week).
The United States and Iran have officially confirmed reaching an understanding, with a formal signing scheduled for the 19th in Switzerland. The content may include a permanent ceasefire on all fronts, lifting maritime blockades, gradual reopening of the Strait of Hormuz, exemptions for Iranian crude oil sales from sanctions, and unfreezing Iranian assets. The dilution plan for Iran's high-enriched uranium and details of its nuclear program are to be determined within 60 days of negotiations. In the latter half of last week, the market had already begun pricing in expectations for a ceasefire, with Brent crude oil falling for three consecutive days, accumulating a drop of over 10%. The sharp decline in oil prices has alleviated inflation concerns, and US Treasury yields have also retreated significantly to around 4.4%.
A decline in US inflation in the second half of the year is anticipated, which may help correct previously overblown expectations for interest rate hikes. While the US CPI for May showed a year-on-year increase of 4.2%, the core CPI was only 2.9%, with energy contributing more than half of the overall increase. The moderate core inflation provides room for policy maneuver. With the implementation of the US-Iran agreement and a downward shift in the oil price center, coupled with the high base effect in the second half of 2025, core inflation is expected to weaken significantly in the second half of 2026 compared to the second quarter. The current US economy is in the early stages of recovery rather than overheating, with a significant K-shaped divergence in consumption. Middle- and low-income households face financial pressures, and the Federal Reserve's Beige Book explicitly noted that "signs of weak consumer spending are weighing on market sentiment." Therefore, the threshold for the Federal Reserve to raise interest rates remains high at present, and it is not a situation of being forced to hike due to an overheating economy.
At early morning Beijing time on June 18th, the new Federal Reserve Chair, Kevin Warsh, will hold his first FOMC meeting press conference since taking office. The market widely expects the federal funds rate to remain unchanged at 3.50%-3.75%. The real focus lies in the policy signals Warsh will release and the interest rate guidance from Fed officials as indicated by the dot plot.
Overall, gold is currently facing a rebound window driven by the combined forces of "a phased cooling of rate hike expectations" and "declining opportunity costs due to falling US Treasury yields." The short-term upside potential depends on the wording signals from this week's FOMC meeting and whether oil prices can stabilize at lower levels. From a medium to long-term perspective, the structural factors supporting gold—global central bank gold purchases, reserve structure rebalancing, and US fiscal pressures—have not changed due to short-term fluctuations.
Key signals for gold investment to watch in the coming week: (1) The Federal Reserve's June interest rate meeting; (2) Progress in US-Iran negotiations.
Relevant Products
Gold ETF Hua An (518880) / Link A (000216) / Link C (000217)
Gold Stock ETF Hua An (159321)
Comparison of RMB-Denominated Gold Price Performance with International Gold Prices:
Data Source: Wind, Hua An Fund, as of 2026/6/12
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