Gold has rediscovered its momentum. However, the reason tells a bigger story than another week of rising bullion prices.
Gold jumped more than 7% last week and finished above $4,300 an ounce. That marked its strongest weekly advance since January. Silver moved even faster. It gained more than 10% as precious metals broke out of their mid-summer trading ranges.
Behind those moves sits an unusual combination of geopolitics, oil, interest rates, and relentless central bank gold demand.
Hormuz Turns Oil Into a Gold Market Driver
During much of last week, traders grew hopeful that Iran, Oman, and the United States could reach an agreement that would restore normal shipping through the Strait of Hormuz.
That possibility mattered immediately.
Brent crude had touched $100 per barrel on July 23. Then it fell below $85 as hopes for a Hormuz agreement grew. Lower oil prices eased inflation fears. In turn, traders reduced expectations for aggressive Federal Reserve tightening. That created a powerful tailwind for gold.
However, the story changed again.
By Monday, August 10, hopes for a quick agreement had weakened. Brent crude surged 5% to $87.72. Shipping through Hormuz also remained dramatically below prewar levels. Therefore, bullion investors now face a tug-of-war between falling rate expectations and the inflation threat from another oil shock.
The Federal Reserve will make its next scheduled rate decision on September 16, following its September 15–16 FOMC meeting.
Central Banks Keep Building Their Gold Fortresses
Meanwhile, one of gold’s strongest long-term supports continues to operate far away from the futures pits.
Central banks added a net 51 tonnes to reported gold reserves in June. Poland led the buying with 19 tonnes, while China added 15 tonnes. Uzbekistan added nine tonnes. Kazakhstan and Singapore each added seven tonnes, according to Heraeus data. Russia sold nine tonnes, while Turkey sold two tonnes.
The broader World Gold Council data reinforce that trend. Poland bought 51 tonnes during the second quarter and lifted its first-half purchases to 82 tonnes. China added 33 tonnes during Q2 and 40 tonnes during the first half.
Importantly, reported purchases tell only part of the story. The World Gold Council estimates total central bank net gold demand at 345 tonnes for the first half of 2026. Unreported official-sector buying continues to play a significant role.
That distinction matters. Central banks do not trade gold like momentum investors. Many buy it to diversify reserves, reduce financial-system risk, and hold an asset without another country’s credit exposure.
For gold, that creates a powerful structural bid beneath the daily headlines.
India Slams the Brakes on Silver Imports
Silver faces a very different problem.
India imported just 1.04 million ounces of silver in July, according to Heraeus. That total fell more than 92% from 13.8 million ounces in July 2025. It barely moved from June’s exceptionally weak 1.01 million ounces.
The collapse followed aggressive government action.
India raised gold and silver import duties from 6% to 15% in May. It also restricted most silver imports and later expanded those controls to silver grain and powder. Importers now need prior government authorization for many forms of the metal.
Yet the policy produced an interesting contradiction.
Imports collapsed, but domestic silver tightened. Indian dealers consequently reported premiums reaching roughly $6.50 per ounce in early July despite seasonally weak demand. Reuters also reported severe shortages and unusually high domestic premiums after the restrictions took effect.
That matters globally because India depends on imports for more than 80% of its silver requirements. The country imported roughly 210 million ounces in 2025. For perspective, the Silver Institute puts total global silver demand that year at about 1.13 billion ounces. Therefore, Indian imports alone equaled nearly 19% of worldwide demand.
Gold and Silver Enter the Next Round
The market has already moved beyond Monday’s snapshot.
Kitco showed spot gold near $4,387 an ounce Tuesday morning, August 11. Silver traded near $65 an ounce.
For bullion investors, the message looks increasingly clear.
Gold now draws support from central bank accumulation, geopolitical risk, and shifting expectations for interest rates. Silver shares those monetary forces. However, it must also navigate industrial demand, extraordinary volatility, and new barriers inside one of the world’s largest physical markets.
For now, the Strait of Hormuz may decide what happens next.
If oil falls, inflation pressure could ease and the Fed may gain room to stay patient. If oil surges again, inflation expectations could rise just as geopolitical demand sends investors toward hard assets.
Either way, gold and silver have moved back to center stage.
