Gold's September Demand Ledger: Heavy Official Buying, a Record ETF Pile, and a Fed Meeting That Looms

Poland's central bank ended September holding 672.9 tonnes of gold, a jump of 24.9 tonnes from a month earlier, governor Adam Glapi?ski said. The figure leaves the National Bank of Poland short of its stated 700-tonne target — and the target alone says nothing about when the remaining purchases will come.

Warsaw's buying landed in an unusually busy month for official-sector demand. Preliminary World Gold Council data put global net central-bank purchases at roughly 63 tonnes in September, the strongest monthly reading since November 2024. Those numbers rest on central-bank and International Monetary Fund reporting and remain subject to revision, but they point to solid sovereign appetite rather than a final monthly tally.

China Extends Its Run as Funds Set a Record

The People's Bank of China added 740,000 fine ounces in September, lifting reported holdings to 77.47 million ounces and stretching its buying streak to a 23rd consecutive month. Measured in tonnes, the World Gold Council put the September addition at 23 tonnes — the largest monthly increase since October 2023.

Exchange-traded funds supplied a second pillar of demand. Physically backed gold ETFs drew USD 10 billion worldwide in September, with holdings climbing 67 tonnes to a record 4,256 tonnes.

The demand picture is not uniform, though. Chinese gold ETFs gained even as jewellery demand softened, a reminder that stronger investment flows do not mean every segment is expanding at once. The wholesale physical market tells a similar story: third-quarter physical demand came in at just 234 tonnes, down 21% year on year. Central-bank purchases, in other words, are no proof of broad-based Chinese gold demand.

A Bond Rally Lends a Hand

Gold found support on Friday from a selloff in technology stocks. Worries about the scale of AI investment spending triggered a flight into government bonds, according to Reuters, pushing US yields lower and reducing the opportunity cost of holding a non-yielding asset. A softer dollar added to the tailwind, helping bullion steady after its inflation-driven setback.

The spot price closed the week at USD 4,169.08 per fine ounce, a daily move of -0.04% — evidence that friendlier financing conditions did not translate into a lasting gain by the closing bell.

Rate expectations also shifted at the margin. Market watchers read remarks by Fed Chair Kevin Warsh as pointing to a possible pause in October, dpa-AFX reported, trimming the odds of another hike. That is an interpretation, not a confirmed policy decision.

Inflation Still Sets the Backdrop

September US consumer prices rose 3.7% year on year, a firmer-than-expected print that had hardened expectations of tighter monetary policy and weighed on demand for bullion. The recent relief in the dollar and Treasury yields therefore sits alongside an inflation risk that has not gone away.

Forecasts for a later recovery lean on continued central-bank buying and a potentially weaker dollar — a scenario that requires today's headwinds to fade while structural demand keeps carrying the market. On a yearly horizon, one bank sees potential up to USD 5,000, a projection rather than a level already reached.

The next marker is the Fed meeting on 27–28 October, with the rate decision and press conference on 28 October capable of moving the dollar and yields once more. For gold, the question is whether the recent easing in rate expectations holds. The equity flight offers support; it does not remove the monetary-policy risk.