A tectonic shift is taking place on the global precious metals market, one that could permanently deprive the West of its monopoly on setting the price of the royal metal. Hong Kong, under Beijing’s direct patronage, is challenging London and New York by announcing the launch of its own revolutionary gold settlement system, intended to become Asia’s equivalent of the LBMA.
While market attention is focused on temporary declines in gold prices, triggered by the hawkish policy of new Fed Chair Kevin Warsh, a new bipolar monetary order is being built in the East. According to Michał Tekliński, gold market expert at Goldsaver and Goldenmark, it is precisely this long-term dethroning of the dollar and the fiscal dominance of the United States that are prompting leading analytical institutions, such as MKS PAMP, to forecast a surge in gold prices in the second half of the year to a new all-time high of USD 5,800 per ounce.
The end of May brought a significant cooling of sentiment on commodity exchanges, with gold prices testing levels around USD 4,400 per ounce under the pressure of inflation concerns and rising US bond yields. The official swearing-in of Kevin Warsh as Fed Chair made markets realise that the “higher for longer” strategy and drastic quantitative tightening would remain in place longer than previously assumed. Pressure on paper gold is clearly visible, but beneath the surface of this market noise, entirely new geopolitical and institutional foundations for the gold market are taking shape.
“We are witnessing a historic process in which the traditional London-New York axis is losing its monopolistic position to the East. The Hong Kong government has officially announced that in July this year it will launch the pilot phase of a new central gold settlement system, managed by the state-owned Hong Kong Precious Metals Central Clearing Company. The project, technologically supported by the Shanghai Gold Exchange, is intended to directly replicate the financial architecture of London’s LBMA by introducing settlements based on highly liquid unallocated accounts. This is a direct attempt, planned by Beijing, to create a parallel pricing and settlement mechanism in yuan, aimed at the ultimate dedollarisation of commodities trade in Asia, which already consumes as much as 60% of the world’s gold. Importantly, Wall Street giants such as JP Morgan, HSBC and UBS already sit on the board of this institution, proving that Western capital clearly sees where the centre of gravity in global finance is shifting,” comments Michał Tekliński, gold market expert at Goldsaver and Goldenmark.
The expert points out that a shift towards physical bullion is becoming a key defensive doctrine for many countries, while others — such as Russia, under the impact of disastrous leadership — are being forced to empty their vaults, selling another 5.7 tonnes of gold and bringing their reserves down to the lowest level in 24 years. At the same time, countries such as India, which raised duties to 15%, and Malaysia, which imposed a 10% tariff on LBMA bars, are frantically trying to stop the drain of foreign exchange caused by citizens fleeing local currencies in favour of metals.
Is gold heading for a new all-time high this year?
In this context, the latest forecasts from Swiss giant MKS PAMP look particularly striking. Nicky Shiels, Head of Research and Metals Strategy at the institution, believes that gold could record a year-on-year increase of as much as 30% this year. According to MKS PAMP’s analyses, the average gold price in 2026 will be USD 4,500, while a new, higher all-time high of USD 5,800 per ounce is a fully fair and realistic target for the second half of the year. The institution’s analysts note that after a period of short-term consolidation, long-term arguments — such as US fiscal dominance, structural dollar weakness and geopolitical risk — will take full control of gold valuations.
In forecasting a rally to new highs, analysts are even reaching for deeper macroeconomic comparisons related to US debt. Current US gold reserves represent just 3% of federal government debt, while during the Second World War the figure was as high as 50%. If gold were to secure even 10% of that debt today, its price would have to rise to USD 15,000 per ounce. In turn, the value of US gold holdings — 8,100 tonnes — currently represents 14% of US foreign debt, compared with a long-term average of 50%, which would imply a valuation of around USD 18,000 per ounce. Although MKS PAMP treats scenarios of USD 10,000 by 2030 as a so-called tail scenario — unlikely and extreme — the mere presence of such calculations in the public debate shows the temperature of market sentiment.
“Calculations of this kind, linking the value of gold to the astronomical debt of the United States, are appearing in reports more and more often. Similar arguments were recently cited, for example, by Ole Hansen of Saxo Bank, who is well respected in the industry. However, we must approach this market ‘numerology’ with considerable caution. For investors who feel temporarily disappointed by the current price correction to USD 4,400, visions of gold at several or even more than ten thousand dollars per ounce sound too abstract today and do not resonate with their immediate needs. Instead of looking for magic in large numbers, it is worth focusing on hard fundamentals: Asia is creating its own trading system outside the dollar, physical metal is disappearing from vaults, and the long-term upward trend remains intact,” concludes Michał Tekliński.
Market at a turning point
In summary, the global gold market is at a turning point, where short-term information noise generated by the US Federal Reserve diverges from deep structural changes taking place around the world. While Western speculative investors are selling futures in response to Kevin Warsh’s hawkish policy, Asian countries led by China are building independent financial infrastructure that is permanently shifting the centre of gravity in bullion trading to the East.
This fundamental dedollarisation, supported by the draining of reserves and drastic tariff measures taken by countries such as India, creates a powerful bullish foundation which — in line with MKS PAMP’s forecasts — should push gold prices towards new records in the second half of the year, regardless of temporary fluctuations on exchanges in New York or London.
Source: Managerplus.pl
