To The Moon

Gold market review and key views: Last week, London spot gold closed at $4,165 per ounce (down 0.7% week-on-week), while domestic AU9999 gold closed at 902 yuan per gram (down 0.2% week-on-week). US September CPI came in stronger than expected across the board. US September CPI rose 3.7% year-on-year, above the 3.6% forecast and the highest since May this year, while rising 0.6% month-on-month. Core CPI rose 2.6% year-on-year, above the 2.5% forecast, and 0.3% month-on-month, holding at that elevated level for a second straight month. Energy remained the headline driver, with energy prices up about 20.4% year-on-year and gasoline surging 9.1% month-on-month, accounting for more than half of the overall CPI increase on its own. More worrying was the upside surprise in core CPI: shelter rose from 0.3% to 0.4% month-on-month and owners' equivalent rent rose to 0.3%, together contributing about half of the core CPI gain; "super core" services excluding housing held at 0.3% month-on-month, but airfares rose 1.2%, hospital services 0.7% and vehicle maintenance 0.7%. The breadth of inflation is spreading rather than staying confined to energy.

The moment the data was released, the market priced it along a hawkish scenario: the dollar index briefly approached the 103 mark, the 10-year Treasury yield pushed above 5.3%, spot gold dived more than 1.5% intraday, and the probability of an October rate hike jumped from about 20% before the data to around 50%. That hawkish pricing did not last, however. The day after the release, the October hike probability had fallen back to around 25%, Treasury yields had given back all their gains and continued to decline, and gold had moved off its intraday lows. This hawkish-then-dovish shift stemmed from the market quickly realizing that September CPI was not enough to force the Fed to act in October.

Constraints came from the other side of the data mix. September nonfarm payrolls added only 29,000, far below expectations, while the unemployment rate rose to 4.2%. Fed Vice Chair Jefferson and several other core officials had already signaled that there was no need to rush into consecutive rate hikes. With inflation beating expectations while employment weakens, choosing to stand pat in October and observe whether second-round pass-through takes hold is the more likely policy option for the Fed.

Looking ahead, international gold prices are holding above the key $4,100 threshold, and the focus is on whether a "W"-shaped double bottom can form. On the flow side, global gold ETFs have still seen net inflows during gold's recent pullback, and combined with strong support from global central bank buying, the funding backdrop for the gold market is favorable. Over the medium to long term, the structural logic supporting gold has not been shaken by recent volatility. US Treasury debt has exceeded $40 trillion, the fiscal deficit reached $1.8 trillion in the first 10 months of fiscal 2026, and net interest expense rose to $963 billion, up 14% year-on-year and equal to about 21.5% of fiscal revenue. US fiscal sustainability concerns, the ongoing trend of central bank gold purchases, and the fragmentation of the geopolitical landscape together form a solid foundation for gold's medium- to long-term allocation value.

Key signal to watch for gold investment in the coming week: developments in the US-Iran situation.

Investment tools: Huaan gold series products

For investors who want to gain gold exposure through public funds, Huaan Fund has built a relatively complete gold product matrix: Gold ETF Huaan (518880) closely tracks domestic spot gold prices and is an efficient tool for on-exchange investors to position in gold; Gold ETF Feeder A (000216)/Feeder C (000217)/Feeder I (022653) provide convenient subscription and redemption channels for off-exchange investors, especially those with regular investment and medium- to long-term allocation needs (Class A suits long-term holding, Class C suits short- and medium-term trading, and Class I suits short-term trading); Gold Stocks ETF Huaan (159321) focuses on upstream listed companies in the gold industrial chain and may capture the elasticity of gold stocks as gold prices rise, suiting investors who want greater elasticity within gold assets.

Fund fee disclosure: Regarding ETF subscription/redemption fees, when investors handle cash subscription or redemption, the sales institution may charge a certain fee/commission of no more than 0.5%, which includes related fees charged by exchanges, registration and settlement institutions and others. For Gold ETF Feeder A (000216), a single subscription amount M below 1 million yuan carries a subscription fee of 0.60%; 1 million yuan up to but below 3 million yuan carries 0.40%; 3 million yuan up to but below 5 million yuan carries 0.15%; and M of 5 million yuan or more carries a flat fee of 1,000 yuan per transaction. For redemption, a holding period Y of less than 7 days carries a redemption fee of 1.50%; 7 days up to but less than 1 year carries 0.10%; and Y of 1 year or more carries 0.00%. The management fee is 0.50% and the custody fee is 0.10%. For Gold ETF Feeder C (000217), the subscription fee is 0.00%. For redemption, a holding period Y of less than 7 days carries a redemption fee of 1.50%; 7 days up to but less than 30 days carries 0.10%; and Y of 30 days or more carries 0.00%. The management fee is 0.50%, the custody fee is 0.10%, and the sales service fee is 0.35%. For Gold ETF Feeder I (022653), the subscription fee is 0.00%. For redemption, a holding period Y of less than 7 days carries a redemption fee of 1.50%; and Y of 7 days or more carries 0.00%. The management fee is 0.50%, the custody fee is 0.10%, and the sales service fee is 0.10%.

Risk disclosure: Investors are reminded to pay attention to the specific risks of investing in gold-themed funds, such as the risk of gold market fluctuations, the risk that fund portfolio returns deviate from domestic spot gold price returns, and the investment risks of the Shanghai Gold Exchange spot gold market. Gold Stocks ETF is an equity fund that mainly invests in the constituent stocks and candidate constituent stocks of the underlying index and has risk-return characteristics similar to those of the underlying index. Gold Stocks ETF may invest in stocks eligible for the Stock Connect, and will face foreign exchange risk and specific risks arising from differences in the investment environment, investment targets, market systems and trading rules under the Stock Connect mechanism. The fund management company does not guarantee that the above funds will be profitable, nor does it guarantee minimum returns, and past performance of a fund cannot predict future returns. China's fund industry has a relatively short operating history and cannot reflect all phases of stock market development. Markets carry risk, so invest prudently and bear your own risk. Before investing in a fund, investors should carefully read fund legal documents such as the Fund Contract and the Prospectus, fully understand the risk-return characteristics of the fund product, and, on the basis of understanding the product and taking into account the suitability opinions of the sales institution, make independent decisions about fund investment according to their own risk tolerance, investment horizon and investment objectives, and choose suitable fund products.