Deutsche Bank Says Central Bank Gold Purchases and ETF Inflows Support Gold Rising to $4,300/Ounce

Deutsche Bank believes that the fifth phase of gold's upward trend, which began in 2024, is not yet over. Central bank gold purchases and the inflow of ETF funds provide dual support, with the spot price of gold currently trading above $4,300 per ounce, and the year-end target range set at $4,700 to $5,100 per ounce. Michael Hsueh, a commodity strategist at Deutsche Bank, pointed out in a recent report that central banks are the most important structural buyers in the current gold market. In the first quarter of 2026, central bank gold purchases reached a record high in real dollar terms, totaling $38.88 billion. The report indicates that about half of the central bank gold purchase demand has not been reported through IMF channels, with the quarterly scale of unreported demand significantly increasing since the third quarter of 2022. ETF fund flows are also improving, with net inflows into gold ETFs reaching 1.5 million ounces over the past 30 days, and global ETF holdings increasing by approximately 4 million ounces year-to-date, indicating a return to positive fund flows. The Asian market is a net buyer, with significant contributions from China, Japan, and India, while developed markets are primarily net sellers. Deutsche Bank noted that Chinese gold ETF holdings have seen their first annual net increase since 2020. The long-term pricing model of Deutsche Bank is centered on the expansion of U.S. government debt, and it is expected that the year-on-year growth rate of U.S. public debt will remain high in 2026, providing support for gold prices. The report also noted that gold futures positions are not crowded, with open interest dropping to its lowest level since 2009, suggesting that if further funds continue to flow in, there is still room for gold prices to rise further.

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