Gold Trades Like a Risk Asset as Central Banks Stay the Last Steady Buyer
Gold is supposed to do one thing above all else, which is hold its value when other assets fall apart. For most of 2026 it has done the opposite, sliding alongside stocks instead of cushioning them. Now bullion is clawing back ground, and the miners that dig it up are the leveraged version of that bet.
Last year's run has unwound
Bullion surged 65% in 2025, its best annual performance since the 1970s, according to Reuters columnist Jamie McGeever. It's down 9% so far in 2026, the worst performer by year-to-date dollar returns in Bank of America's list of 14 major asset classes.
The metal peaked at $5,595 an ounce in January. One-week realized volatility hit 90% at that peak, a level normally reserved for meme stocks.
Gold Gave Back Part of Last Year's Surge
Gold price return, %, 2025 full year and 2026 year to date as of Nov. 3, 2026
Bar chart. Return, %. 2025: Gold Return 65%. 2026 YTD: Gold Return -9%.
Yields are doing the damage
Higher interest rates are the main culprit. Gold pays no income, so every uptick in Treasury yields raises the cost of owning it.
The benchmark 10-year US Treasury yield sat near 4.91% on Nov. 3, up 77 basis points this year, with the 2-year at 4.58% and the 30-year at 5.29%. The US Dollar Index ticked up to 101, roughly 3% higher since the start of the year, making bullion pricier for overseas buyers.
High Treasury Yields Are Competing With Gold
US Treasury yields, %, as of Nov. 3, 2026
Line chart. Yield (%). 2-year: Yield (%) 4.58%. 10-year: Yield (%) 4.91%. 30-year: Yield (%) 5.29%.
Source: Business Insider
Markets are pricing in a 75% chance the Federal Reserve raises rates another quarter point before year end. Traders put a 21% probability on a second quarter-point hike in January.
A hedge that stopped hedging
Even war has failed to lift the metal. Gold has shed about a quarter of its value since the US and Israel first attacked Iran on Feb. 28, and an International Monetary Fund paper in July found its safe-haven properties are neither universal nor unconditional.
Its correlation with the S&P 500 is now positive at 0.48 on a three-month rolling basis, per Standard Chartered analysts Suki Cooper and Steven Englander. When stocks drop hard, investors sell gold to raise cash rather than buy it for protection.
"Gold is increasingly behaving like a risk asset, which is an entirely new dynamic."
David Rosenberg, Rosenberg Research
Retail demand is thinning too. Bar and coin demand has fallen 19% year over year and global jewelry demand is down 17%, the World Gold Council said.
Official buyers are the exception. Central bank purchases climbed 42% in the third quarter to 321 metric tons, the biggest quarterly total since the final quarter of 2024, with Poland and China doing most of the buying. The council expects investment demand to finish 2026 around 200 tons above 2025, with mine production possibly hitting another record for the year.
Why miners move more than metal
Gold ended October at $3,884 an ounce, its worst October since 2008, which left the 16 gold miners in the ranking worth a combined $500B. October alone took $226B off the MINING.COM Top 50, on top of September's $264B loss.
The rebound runs the same way. Spot gold climbed 3.02% to $4,446.90 an ounce on Nov. 4 as the dollar fell to a one-month low, lifting Barrick Mining, Newmont, Agnico Eagle Mines, and Kinross Gold. Miners are a geared play on the gold price, because their costs are largely fixed while their revenue swings with bullion.
Company news still cuts both ways. Newmont beat third-quarter profit estimates and put a price of up to $4.8B on taking Red Chris underground.
Consolidation is the other thread. Gold Fields made an A$38.7B ($27B) approach for Australia's Northern Star, rejected as highly opportunistic in late September, with Elliott Investment Management building a 6.2% stake to push the board toward talks.
Interactive Brokers senior economist Jose Torres sees a different risk, arguing gold may be entering a yearslong stretch of subdued gains like the decade that followed its post-2008 run.
