{"id":648,"date":"2025-10-27T21:41:21","date_gmt":"2025-10-27T21:41:21","guid":{"rendered":"https:\/\/bulliondata.com\/blog\/?p=648"},"modified":"2026-06-30T18:16:27","modified_gmt":"2026-06-30T18:16:27","slug":"gold-still-underowned-why-surging-investment-demand-hasnt-exhausted-the-bull-case","status":"publish","type":"post","link":"https:\/\/bulliondata.com\/blog\/gold-still-underowned-why-surging-investment-demand-hasnt-exhausted-the-bull-case\/","title":{"rendered":"Gold Still Underowned: Why Surging Investment Demand Hasn\u2019t Exhausted the Bull Case"},"content":{"rendered":"\n

Hook:<\/strong> Gold has ripped to record highs, yet leading strategists argue that gold is still underowned<\/strong>. That paradox is exactly why many bullion buyers, coin investors, and U.S. allocators see more upside ahead\u2014even after a historic run. As one State Street Investment Management analyst put it in early October, it\u2019s a matter of when<\/em>, not if<\/em>, the market tests $4,000 per ounce.<\/p>\n\n\n\n

TL;DR:<\/strong> Despite a powerful rally to fresh records above $3,900\/oz, multiple data points show room for additional participation: persistent ETF inflows, robust central-bank demand, and shifting Western investor behavior. Meanwhile, the World Gold Council (WGC) reports the strongest first-half investment demand since 2020, with Asia\u2019s bar-and-coin buyers leading\u2014and U.S. retail coin\/bar buying still subdued. For investors, that gap is an opportunity, not a red flag. <\/p>\n\n\n\n

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Why \u201cGold Still Underowned\u201d Matters Now<\/h2>\n\n\n\n

When gold vaulted past $3,900\/oz<\/strong> in early October, headlines focused on peak prints and profit-taking. But context matters: the breakout overlapped falling real-rate expectations, recurring policy uncertainty, and renewed safe-haven flows\u2014conditions that tend to support sustained strength rather than a blow-off top. Reuters captured the moment: spot hit a record near $3,959 as investors bought insurance against economic and political risks while wagering on further U.S. rate cuts.<\/p>\n\n\n\n

In that setting, State Street\u2019s Aakash Doshi<\/strong> emphasized that\u2014despite heavy buying in September\u2014holdings across gold funds remain below<\/em> their 2020 peak, and earlier this year GLD still saw outflows. Translation: participation isn\u2019t saturated. That\u2019s the heart of the \u201cgold still underowned\u201d<\/strong> thesis.<\/p>\n\n\n\n

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Expert view (paraphrased from Kitco interview):<\/strong> \u201cThe rally has been driven increasingly by investment demand, but positioning isn\u2019t stretched. Gold can grind higher, even if the path is choppy toward $4,000.\u201d<\/p>\n<\/blockquote>\n\n\n\n

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The Market Structure Behind the Rally<\/h2>\n\n\n\n

Investment Demand Is Doing the Heavy Lifting<\/h3>\n\n\n\n

The WGC\u2019s Q2 2025<\/strong> report shows total demand rising 3% year-over-year to 1,249 tonnes<\/strong>, with the value of that demand surging 45%<\/strong> to a record US$132 billion<\/strong>\u2014driven chiefly by robust ETF inflows<\/strong> across consecutive quarters. In other words, investors\u2014not jewelry\u2014are the marginal price setter right now. <\/p>\n\n\n\n

Central Banks Are a Persistent Bid<\/h3>\n\n\n\n

Multiple outlets, including Reuters, detail how central banks<\/strong> have accumulated gold at historically elevated paces since 2022 (even with some moderation this year). Reserve diversification and sanction risk after Russia\u2019s reserve freeze continue to underwrite structural demand.<\/p>\n\n\n\n

Asia\u2019s Physical Buyers vs. America\u2019s Slow H1<\/h3>\n\n\n\n

WGC country data show China and India<\/strong> leading bar-and-coin demand in H1, while U.S. bar and coin demand<\/strong> slumped 53% year-over-year<\/strong> to just 9 tonnes in Q2<\/strong>\u2014the weakest since Q4 2019. That\u2019s an important backdrop: U.S. retail<\/em> hesitancy can turn into late-cycle catch-up buying if momentum persists. <\/p>\n\n\n\n

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Gold Still Underowned: Where the Next Buyer Comes From<\/h2>\n\n\n\n