Gold Slumps as Jobs Data and SpaceX IPO Drain Liquidity, Even as China and Central Banks Stockpile

Gold slid 8% in 30 days to $4,352.90 as robust US jobs and SpaceX's $75B IPO pressure the metal, but central banks—led by China—keep buying at record pace, while geopolitical tensions and inflation data loom.

Gold is caught in a tug-of-war between powerful bullish and bearish forces. The metal closed at $4,352.90 on Friday, suffering a loss of nearly 8% over the past 30 days and slipping below its 50-day moving average. That puts it well off the January record high just above $5,626. Yet beneath the surface of this slide, central banks are quietly building positions at a pace not seen in years.

The biggest near-term drag comes from a surprisingly strong US jobs market. Robust payrolls figures have pushed rate expectations higher, lifting the dollar and hammering non-yielding assets like bullion. Adding to the pressure, SpaceX plans to launch the largest initial public offering in history on June 12 at the Nasdaq, targeting a massive $75 billion flotation. Market watchers expect the event to suck liquidity out of other asset classes, and precious metals typically feel the pain first.

Offsetting those headwinds is a relentless buying spree by official institutions. China’s central bank added another 320,000 fine ounces of gold in May, marking the 19th consecutive month of purchases — the longest such streak in over a decade. A report from the European Central Bank confirms the broader trend: gold has overtaken US Treasuries as the world’s second-most important reserve asset, accounting for 27% of global currency reserves at the end of 2025.

But institutional hunger stands in stark contrast to weak consumer demand. Metals Focus expects total gold demand to slip to roughly 4,180 tonnes in 2026, a 2% decline. The jewelry sector is bearing the brunt, with analysts forecasting a drop of up to 11% as elevated prices keep retail buyers at bay. That leaves institutional investors almost alone in propping up the current price level.

Geopolitical tensions are adding another layer of uncertainty. Over the weekend, rockets struck Israel, jeopardising the fragile ceasefire with Iran. The fresh turmoil sent oil prices surging more than 2%, reigniting inflation fears that put the Federal Reserve in a tighter spot. Washington releases its consumer price index on Wednesday, a key input for the Fed’s mid-June rate decision. The current fed funds rate sits between 3.50% and 3.75%, and markets expect no change. If inflation data runs hot, the pressure on gold will intensify — higher rates make the non-yielding metal far less attractive.

Complicating the picture further, Russia has abruptly released official gold production estimates for the first time since its invasion of Ukraine. Natural Resources Minister Alexander Kozlov suggested output could reach 500 tonnes this year — a figure that has drawn widespread skepticism. The World Gold Council had projected only 330 tonnes, and analysts at Metals Focus see Russian production as significantly lower. The gap of more than 150 tonnes is hard to explain given that no major new mines have opened in recent years. If Moscow’s numbers were accurate, Russia would overtake China as the world’s largest gold producer. Yet the reality at the central bank tells a different story: the Bank of Russia is actually reducing its reserves to plug war-related budget holes, having sold roughly 28 tonnes of gold this year alone to raise over $4 billion.

With so many competing forces at work, gold’s technical setup is deteriorating. The next major support sits at $4,300. A break below that level could trigger a swift selloff that even China’s relentless buying may not be able to stop.