The gold market remains structurally supported by official buying even as investors reduce exposure. Q1 2026 total supply was 1,231 tonnes, up 2% year over year, with mine output at 885 tonnes and recycling at 366 tonnes.
Central banks are the key buyer. The World Gold Council estimated net purchases of 244 tonnes in Q1, and April data showed another 17 tonnes added, led by Poland and China.
Mine supply is rising, but not enough to loosen the market quickly. Analysts expect 2026 mine output to increase only modestly to around 3,900 tonnes, while recycling remains constrained by thin above-ground liquidity.
For procurement teams, the important point is separation between price volatility and reserve demand. Short-term ETF selling can drive headlines, but central bank accumulation keeps the long-run floor higher.
Use central bank demand as the structural signal, not the daily ETF flow. Maintain a layered hedging policy and keep liquidity for dips that are not matched by a break in official-sector demand.