On July 29, 2026, the World Gold Council (WGC) released its latest "Global Gold Demand Trends Report," stating that global demand for gold bars and coins reached 682 tonnes in the first half of 2026, a 12% year-on-year increase and a five-year high for the period. Asian markets stood out, with China, India, Vietnam, and other economies collectively contributing 67% of the net increase in global gold coin and bar demand, becoming the core engine of growth. This data has attracted widespread market attention—why has Asian investors' enthusiasm for physical gold purchases surged against the trend amid the Fed's wavering interest rate decisions and USD gold prices fluctuating around $5,000 per ounce? Is the gold market barometer shifting from Europe and the US to the East?
Asia Becomes 'Main Battlefield' for Physical Demand
The report shows that China's demand for gold bars and coins reached 128 tonnes in the first half, up 18% year-on-year; India's demand reached 96 tonnes, up 21%; and Southeast Asia (including Vietnam, Indonesia, and Thailand) saw combined demand grow about 25% to a record 67 tonnes. A World Gold Council market analyst said: "Asian investors face local currency depreciation pressure, stock market volatility, and a prolonged downturn in real estate markets, which has boosted the willingness to allocate to gold as a store of value. In particular, in Vietnam, against the backdrop of real estate market adjustments and high inflation expectations, the phenomenon of people buying gold bars as a savings tool has increased significantly."
Notably, despite international gold prices remaining at historical highs above $5,000/oz, raising the purchase cost of physical gold, this has not dampened Asian investors' enthusiasm. In China, although gold ETF holdings have declined slightly, physical gold bar sales have climbed against the trend, with some bank gold bar products temporarily out of stock. In India, with the approach of the traditional festival season (e.g., Dussehra, Diwali), wedding-related gold buying demand combined with investment demand may further boost imports in the coming months.
Gold Market Barometer Shifts: Investment Logic Changes
Traditionally, gold prices have been dominated by the monetary policies of Western central banks, changes in ETF holdings, and risk aversion. However, data from the first half of 2026 shows that Asian retail investors are becoming marginal pricing power. Year-to-date, net long positions in COMEX gold futures have fallen by about 9%, while demand for physical gold bars and coins in Asia has continued to rise. This reflects a structural shift: institutional speculators and retail physical buyers have diverged in their judgment of gold price trends.
"Over the past decade, the gold bull market was mainly driven by Western central banks and ETF funds, but now Asian high-savings-rate households are taking the baton," said Andrew Su, a senior precious metals analyst. "When Indian rural households perceive that rupee deposit rates are effectively negative, they convert savings into gold jewelry or bars. When the Vietnamese middle class feels real estate liquidity risk, they buy 1-ounce gold coins as emergency reserves." This 'grassroots gold buying wave' provides a more solid floor for gold prices—even if speculative funds withdraw, physical delivery demand can stabilize the market.
Global Context: Central Bank Gold Buying and Supply Bottlenecks
Meanwhile, global central banks purchased a net 483 tonnes of gold in the first half, slightly below the peak of the same period last year but still historically high. The People's Bank of China increased its gold reserves for the 11th consecutive month, with official reserves reaching 2,280 tonnes. The State Bank of Vietnam also slightly increased its gold reserves. The sustained buying by central banks has further tightened liquidity in the physical market.
The supply side is under pressure. Mine production in major gold-producing countries such as South Africa and Peru has declined slightly due to rising costs and labor disputes, with the average mining cost exceeding $1,800/oz. Although recycled gold supply has increased, the growth rate is insufficient to compensate for the decline in new mine output. This means that the tight physical supply situation may support gold prices in the medium to long term.
Outlook for H2: Key Variables Still in Geopolitics and Interest Rates
Looking ahead to the second half of 2026, whether Asian demand can persist will depend on local economic performance. If the Fed initiates a rate-cutting cycle in H2, a weaker dollar would benefit gold priced in non-USD currencies, further stimulating Asian buying. However, if geopolitical risks (such as the Middle East situation or Taiwan Strait tensions) escalate, gold's safe-haven function will be reinforced globally.
The World Gold Council expects global gold bar and coin demand to surpass 1,400 tonnes in 2026, with Asia accounting for over 55%. For investors, grasping the shift in the gold market barometer means paying closer attention to the monetary policies of major Asian economies, household savings habits, and local gold price premiums. When gold's investment logic tilts from "interest rate expectations" to "survival-type hedging," the resilience of physical gold deserves special attention.
Conclusion
The eastward shift of the gold market barometer is not only a geographical shift in investment focus but also reflects a deep evolution in the global wealth management paradigm. Amid the noise of digital assets, physical gold, with its millennia-old physical properties and inclusiveness, has regained the trust of households. For emerging market countries like Vietnam, gold is not only a vehicle for jewelry and investment but also a 'stable anchor' to navigate economic cycles. Follow Vietnam Raw Materials Information Network; we will continue to track trading dynamics and premium changes in the Asian physical gold market, providing you with accurate buy and sell references.
