Gold has attracted over $500 billion in inflows despite rising U.S. Treasury yields, gaining nearly 15% since late June while the 10-year Treasury yield surged approximately 20%. This marks a structural shift as central bank demand has countered gold’s traditional sensitivity to interest rates. Chinese gold ETFs added 11 tonnes in August, bringing total holdings to 293 tonnes, the highest level since April. This divergence raises questions about capital allocation between gold and Bitcoin ahead of the FOMC. If yields remain elevated and the dollar weakens, gold could continue attracting capital, creating additional pressure on risk assets such as crypto.
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