TechFlow news, November 30 — According to Jinshi News, CITIC Construction Investment Securities released a research report stating that marginal demand has become increasingly influential in gold pricing. Returning to traditional supply and demand logic, given that gold supply remains relatively stable with annual production maintained at around 3,600 tons, the key variable in gold pricing lies in demand—particularly marginal demand. Gold demand mainly consists of three components: private-sector consumer demand, private-sector investment demand, and official sector purchases. In the past, marginal demand for gold was primarily driven by ETF demand from Europe and the United States (representing private-sector investment demand in these regions, mainly from overseas institutional investors), whose investment framework largely depended on U.S. Treasury real interest rates. Private-sector investment demand from Europe and the U.S. (such as ETF demand) still shows strong correlation with U.S. Treasury real interest rates. With declining U.S. inflation and weakening labor market resilience, expectations for Fed rate cuts in the second half of the year are rising. The anticipated decline in nominal and real interest rates following the start of rate cuts will provide new momentum for gold price increases.
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