In short
- Gold hit a record of about $5,500 an ounce in late January 2026. On 29 September it was around $4,160, roughly 24% lower.
- The big money didn’t simply sell in January. Gold funds had record inflows that month. The big outflows came in March and June.
- Some countries keep buying, like Poland and China. Others sell because they need cash, like Russia and Turkey.
- I see gold as a 10+ year asset. I build my position slowly, and part of it goes through gold mining companies.
You are starting to invest your money into different assets, one of them being gold. You know it might be a safe haven against inflation. Then you look at the price.
“Now prices are dropping again. Is this a natural correction or is this a downward trend?”
To answer that, we first have to understand what gold really does for a professional investor. We’re looking at what bankers do, institutions, countries. And it’s very simple: they’re waiting for the long term. 10+ years.
Does that mean we have to give up? No. But before deciding anything, I want to zoom out a little bit.
Zoom out: the real move happened in 2025
Going back to 2025, nobody’s talking about it, but this is where the knowledge is hidden. In 2025 gold went from about $2,625 an ounce to about $4,315. A 65% uptrend in a year is crazy. That’s where the real money was made. It was gold’s best year since 1979.
The rally carried on into 2026. On the LBMA gold price, the official daily benchmark set in London, gold reached a record $5,501.70 in late January 2026. On 29 September, spot gold traded around $4,160, about 24% below that record.
It’s just a correction, you might think. But are we sure? You might never know. One thing we do know is what is happening around the world, and we can look at numbers that paint the real picture.
What the big money actually did
In the video I said institutions took their profits right around January. When I checked the data, that turned out to be wrong, and the real picture is more interesting.
The World Gold Council tracks gold ETFs, funds that hold gold for investors. January 2026 was their strongest month ever, with about $19 billion flowing in. The big money was still buying at the top.
The selling came later. March saw a record outflow of about $12 billion, and June another $8.9 billion. Then August flipped again: about $18 billion came back in, and holdings hit a new record of 4,189 tonnes. The big money didn’t leave in one go. It has been moving in and out, quite violently.
Who keeps buying
Central banks are the most patient buyers of all. They’ll sit on their gold for a decade or more, unless there’s an emergency. Gold is not only a safe haven against inflation. It’s also protection against the debasement of a currency, in case of war or something else that makes a currency worthless.
Poland is the standout. Its central bank bought 90 tonnes in 2024, 102 tonnes in 2025 and another 90 tonnes in the first seven months of 2026. It holds about 640 tonnes and is aiming for 700.
China’s central bank has added gold every month since November 2024, 22 months in a row through August 2026, and now holds about 2,387 tonnes.
Who is selling, and why
On the other side, there are also countries selling gold. Why are they doing it?
Look at Russia. They need to sell their gold. Russia was the biggest seller in the second quarter and sold about 50 tonnes this year through July, to help cover its budget deficit.
Turkey sold about 85 tonnes through July. Its central bank used gold to raise dollars and defend its currency, the lira, during the turmoil around the Iran war.
Selling because you need money looks the same on a chart as selling because you’ve turned negative on gold. It isn’t the same signal.
Central banks overall are still net buyers. The World Gold Council counts 345 tonnes in the first half of 2026, the lowest first half since 2022, though that partly reflects a sharp downward revision of first-quarter data. The second quarter alone, 289 tonnes, was a record for a second quarter.
Why gold is weak right now
Gold pays no interest. When safe savings and bonds pay more, holding gold costs you more in missed interest. On 16 September the Federal Reserve raised its key rate to 3.75–4.00%. On 29 September the US 10-year government bond yielded 5.26%. That’s a strong headwind for an asset that pays nothing.
The bigger picture hasn’t changed, though. The dollar, the euro, the yen: none of them is backed by gold anymore. That means every dollar is just that, a dollar, and the worth of a dollar might be less over time. That’s called inflation.
What I’m doing
“Nobody knows what is going to happen next.”
So I treat gold as a slow-moving, long-term asset. It’s not generating any income like a company such as Nvidia does, making something less valuable into more valuable. No, gold just stays as it is.
Does that mean I buy it all right now? No. I put my money in slowly over time and take the average price, rather than buying at an all-time high like many retail investors unfortunately do. This is called dollar-cost averaging: investing equal amounts at regular intervals, whatever the market does.
I’ve been investing since I was 16 years old. I had some ups and downs, and I don’t want you to make the same mistakes.
And there’s a best of both worlds that many gold buyers overlook: companies that dig gold from the earth. They produce revenue, cash flow and profits. These companies are sitting on land with gold right beneath their feet, and they get it out slowly over time. Part of my gold exposure goes through them.
It cuts both ways. Many mining costs are fixed, so a change in the gold price makes a bigger change in profits. In 2025 gold rose about 65% while the NYSE Arca Gold Miners Index rose more than 150%. The same leverage works on the way down.
Want the opposite view? Read The Devil’s Advocate version of this story.
Keep reading
- What You Actually Own When You Buy a Gold ETF
- The Devil’s Advocate: A Gold ETF Beats a Bar in Your Drawer
- The War Was the Headline. The Bond Market Was the Story.
I’m not a financial adviser. This is my own investing journey, not financial advice. Any investment decision is your own.