30-Year Treasury Yield Hits 5.234%, Mixed Demand for Gold

The yield on the U.S. 30-year Treasury bond rose to 5.234% on August 18, marking the highest level since June 2007. The 10-year yield reached 4.740%, while Japan's 10-year yield was at 2.950% and Germany's 10-year yield hit 3.270%. The rise in long-term interest rates increases government borrowing costs and market discount rates, leading to higher costs of holding gold. The U.S. Consumer Price Index (CPI) for July increased by 0.1% month-over-month and 3.4% year-over-year, with core CPI rising by 2.5%. According to the World Gold Council, global total demand for gold in the first quarter of 2026 is projected to be 1,231 tons, a 2% increase compared to the same period last year, with a demand value of $193 billion. Bar and coin demand increased by 42% to 474 tons, while $8.9 billion was withdrawn from ETFs in June. Overall, there was a net inflow of $8 billion in the first half of the year, driven by Asian capital. Despite price pressures, gold demand is supported by physical investments and central bank purchases. The World Gold Council forecasts that gold prices will move within a ±5% range around $4,100 per ounce, with the potential to rise to $4,500 in the event of geopolitical shocks or lower interest rate expectations.