PANews reported on November 30th that, according to a research report released by CITIC Securities, marginal demand is increasingly explaining gold pricing. Returning to the traditional supply and demand logic, given the relatively stable gold supply, with annual production remaining around 3,600 tons, the true pricing variable for gold lies in demand, especially marginal demand. Gold demand mainly comprises three parts: private sector consumption demand, private sector investment demand, and official gold purchase demand. In the past, marginal demand for gold was primarily contributed by demand from European and American ETFs (private sector investment demand in Europe and the US, mainly from overseas institutional investors), and this demand or investment framework largely depended on the real interest rate of US Treasury bonds. Private sector investment demand in Europe and the US (ETF demand, etc.) still shows a strong correlation with the real interest rate of US Treasury bonds. With declining US inflation and a weakening labor market, expectations for a Fed rate cut in the second half of the year are rising. The resulting decrease in nominal and real interest rates will inject new momentum into gold price increases.PANews reported on November 30th that, according to a research report released by CITIC Securities, marginal demand is increasingly explaining gold pricing. Returning to the traditional supply and demand logic, given the relatively stable gold supply, with annual production remaining around 3,600 tons, the true pricing variable for gold lies in demand, especially marginal demand. Gold demand mainly comprises three parts: private sector consumption demand, private sector investment demand, and official gold purchase demand. In the past, marginal demand for gold was primarily contributed by demand from European and American ETFs (private sector investment demand in Europe and the US, mainly from overseas institutional investors), and this demand or investment framework largely depended on the real interest rate of US Treasury bonds. Private sector investment demand in Europe and the US (ETF demand, etc.) still shows a strong correlation with the real interest rate of US Treasury bonds. With declining US inflation and a weakening labor market, expectations for a Fed rate cut in the second half of the year are rising. The resulting decrease in nominal and real interest rates will inject new momentum into gold price increases.