(Kitco News) – China’s 2026 gold imports could be double those of last year, and will set the high-water mark for the 2020s to date, while silver prices are approaching a key test that could determine the gray metal’s near-term direction, according to precious metals analysts at Heraeus.
In their latest update, the analysts noted that China’s gold imports have already exceeded 2025 totals in 2026. “China imported 142 tonnes of gold in August, taking imports during the first eight months of the year to 1,141 tonnes, 72% higher than the 663 tonnes imported over the same period last year, and higher than the 940 tonnes imported during the whole of 2025,” they wrote. “The strong inflows come despite historically high gold prices and reflect continued investment demand, while Chinese jewellery demand remains comparatively weak. These non-monetary imports are separate from purchases by the People’s Bank of China, which added a further 20 tonnes to its official reserves in August.”
“If Chinese gold imports maintain this pace through the rest of 2026, they will total ~1,700 tonnes, which would represent the highest amount this decade.”
Australia’s gold mine production continued to rise in fiscal year 2025-26 as historically high prices continue to support the mining sector. “Australia produced 303 tonnes of gold up to the end of its financial year in June, broadly in line with its long-run production rate of around 300 tonnes p.a.,” the analysts said. “Output improved at most operations during the June quarter, while several smaller producers also began production. The 303 tonnes produced in Australia account for around 8% of total mined gold supply, which was 3,822 tonnes in 2025.”
Heraeus said Indonesia is proposing a scheme to incentivize privately held gold stocks to be invested into the formal financial system. “The government estimates that households hold around 1,800 tonnes of gold outside formal investment channels and has asked state-owned institutions to encourage around 20% of this metal, equivalent to roughly 360 tonnes, into bullion-banking and financial products,” they wrote. “The initiative is aimed at turning privately held metal into deposits, collateral and other financial assets, deepening the domestic bullion market and potentially increasing the amount of household wealth circulating through the financial system.”
The analysts also warned that India’s weak monsoon will likely depress rural gold demand during this year’s festival and wedding season – and rural demand represents over 50% of the country’s total bullion consumption. “Monsoon rainfall was around 15% below its long-run average by late September, presenting a downside risk to gold demand due to the potential of lower crop yields to impact rural incomes,” they said. “Historical analysis by the World Gold Council suggests that a 1% increase in rainfall relative to the average is associated with a 0.2% increase in gold demand, implying that this year’s rainfall deficit could represent a modest headwind. Indian gold demand totalled 768 tonnes in 2025, roughly 15% of global demand.”
Spot gold was continuing to test session lows early in the North American session, and last traded at $4,142.30 for a loss of 3.33% on the daily chart.
Turning to silver, Heraeus analysts noted that the renewed strength of the U.S. dollar has driven silver prices to a key inflection point.
“Silver prices dropped below $65/oz last week as the dollar index rose back above 101.0, towards its yearly highs,” they noted. “This leaves silver at an important level. A renewed rally back towards $70/oz despite a rising dollar, a hawkish Federal Reserve and rising bond yields could signal a confirmation of a potential bottoming process. However, if silver falls back below $60/oz, this could be the sign of a continuation of the bearish downtrend, marked by lower highs and lower lows, in which silver has been stuck since its late January peak.”
The analysts wrote that the 10-year Treasury yield’s rise to 5.22% and the 10-year Treasury Inflation-Protected Security (TIPS) real yield hitting 2.8% indicates that the Federal Reserve’s 25 basis point rate hike in September was not enough to reassure markets.
“The rise in real yields alongside nominal yields is particularly significant for precious metals, indicating that the sell-off in Treasuries has not been driven solely by higher inflation expectations, but also by investors demanding a higher inflation-adjusted return, consistent with the anticipation that monetary policy could remain tighter for longer,” they said. “This comes as Brent crude remains around $100/bbl, and despite renewed talks between the US and Iran, a deal to reopen the Strait of Hormuz does not appear imminent.”
And Indian silver imports spiked higher in August after several months of weak inflows. “India imported 15.5 moz of silver in August, the first time since February that monthly imports have topped 10 moz and 36% higher than the 11.4 moz imported in August 2025,” the analysts wrote. “Despite the strong monthly recovery, imports remain weak for the year as a whole, with an estimated 75.6 moz imported during January-August, 24% less than the 99.1 moz imported over the same period last year.”
“The rebound follows several months of unusually low imports after the licensing requirements introduced in May complicated the import process and high silver prices reduced demand, they said. “The upswing in August suggests that physical inflows are beginning to normalise, although year-to-date imports remain well below last year’s levels.”
Silver prices were also trading just above their earlier session lows on Monday morning after dipping below $61 per ounce around 5 am ET.
Spot silver last traded at $61.302 per ounce for a loss of 4.67% on the daily chart.
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