The latest commodity outlook indicates that gold's future trajectory remains highly dependent on whether the Iran conflict and the Strait of Hormuz crisis can be resolved in the long term. Market analysis projects that the gold price will likely approach the current level of $4,000 by the end of this year. In the short term, silver is expected to continue following gold's fluctuations, with a main trading range likely maintained between $55 and $60 per ounce.

Previously, the market anticipated that gold would fall below $4,000 by year-end, but this trend materialized faster than expected. The gold price briefly broke below this level in late June, primarily because the market remained in a wait-and-see stance regarding new investments, and investors lacked further momentum to chase highs in an uncertain environment. Recent weakness in gold has been largely influenced by the unclear prospects of the Iran war. Meanwhile, US stock indices fell nearly 5% within a week, also exerting pressure on gold. Although gold is typically viewed as a risk hedge, when stock markets weaken significantly, investors often sell gold to raise cash to cope with potential margin calls. This has caused gold's traditional inflation-hedge attribute to give way to risk management needs to some extent recently.

Federal Reserve policy remains a key variable. Despite the President's clear preference for lower interest rates, the new Fed appears ready to remain tough on inflation. When the new Fed Chair takes office, the US economy remains resilient, and the labor market is relatively stable. Although no specific policy targets have been proposed yet, one concept is to simplify Fed statements, while there is a dislike for the dot plot, meaning the dot plot may be downplayed or even cancelled in the future. The market believes gold is currently observed mainly through interest rate prospects. The swap market currently expects the probability of a 25 basis point rate hike in the fourth quarter to be about 30%. With the latest core PCE data reaching 3.5%, whether the Fed's 2% inflation target remains realistic may also face more discussion. Currently, gold is still avoiding rate hike risks.

Looking ahead, the gold trend largely depends on whether the Strait of Hormuz crisis can achieve a long-term resolution. Adjustments over the past few months have washed out speculative buying in the gold market. In the past six months, most weak or speculative positions have likely been washed out, leaving certain upside space for gold. However, the current phase remains one of wait-and-see. The market does not expect violent unilateral volatility in gold in the short term, but technical indicators show that the gold price may still face downside pressure recently. If the gold price can hold near the $4,000 level in the coming weeks, it may re-attract physical buyers. Meanwhile, the official sector continues to focus on gold as a general safe-haven asset and its value for hedging currency depreciation trades.

Central bank buying remains a long-term support. A recent central bank survey received a record 76 responses. Among them, 89% of respondent central banks expect global central bank gold reserves to increase in the next 12 months, 45% expect their own gold reserves to rise, and only 1% expect their own holdings to decrease. From a longer-term perspective, 78% of respondents expect the share of gold in total reserves to increase after five years, with 5% expecting a significant increase. Over the past four years, the official sector has cumulatively purchased nearly 4,000 tons of gold, becoming a key component of physical demand. If almost the entire official sector is focusing on current interest rate levels, while geopolitics and inflation follow closely, this aligns completely with the market's perceived key drivers for gold. With the Fed likely not acting until at least the fourth quarter, and the European Central Bank possibly not hiking further, the gold trend will be in a quite interesting environment. The market expects the gold price to roughly maintain near current levels by year-end, but may fluctuate around $4,000 during the period.

The China gold market may offer additional demand clues. Related research includes data on mine gold, recycled gold, gold consumption, China central bank purchases, and net imports over the past 11 years. The China central bank does not always announce changes in gold holdings immediately when actual purchases occur. After cumulating different components of the local supply and demand balance in China, there appears to be a gap of approximately 4,000 tons. This may imply that the Chinese government may have absorbed a portion of the gold, but not necessarily directly counted into the People's Bank of China's official reserve account.

Regarding silver, recent gold and silver movements have been almost synchronized. Only 28% of silver mine supply is price elastic, while the rest of silver production depends on the business models of copper, lead, zinc, and gold mining enterprises. The market expects silver to continue following the gold trend in the short term, meaning silver prices may fluctuate around the $55 to $60 range for some time, but volatility may still be higher than gold. In the long term, silver industrial demand will continue to strengthen. Key drivers include increased usage of precious metals in chips due to AI development, the vehicle electrification trend, and demand from the solar cell industry. Although the solar industry currently faces oversupply, this issue will be gradually digested. In the long run, silver industrial demand will strengthen, while mine supply upside space is limited. Over the next two to three years, as the supply and demand gap expands, the impact of the gold-silver ratio on silver prices may weaken, and industrial use itself may become a more important pricing factor.

Potential bullish factors for gold and silver include renewed tensions in the Middle East, the unsettled situation in Ukraine, continuous buying by the official sector, and certain political and legal risks. Potential bearish factors include a more durable ceasefire agreement, further stock market weakness triggering cash demand, central bank policy tightening, and a hawkish policy stance following the replacement of the Fed Chair. Geopolitics, Fed policy, and central bank buying will continue to determine the direction of gold prices, while silver will seek a new pricing balance between industrial demand and linkage with gold.