SINGAPORE, 13 February 2026 – Gold prices stabilised in Asian trading after suffering a sharp decline triggered by broader financial market jitters, highlighting the fragile balance between safe-haven demand and shifting global macroeconomic expectations.
The precious metal had fallen significantly in the previous session as investors moved toward riskier assets and reassessed monetary policy expectations, prompting profit-taking after gold’s strong rally earlier in the year. The pullback underscores how gold, despite its safe-haven status, remains sensitive to broader market sentiment, interest rate outlooks, and currency movements.
Market Turbulence Sparks Gold Correction
Gold’s decline was largely driven by improving risk appetite in equity markets and easing investor fears over global economic stability. When market volatility subsides, investors often rotate capital away from defensive assets like gold and into higher-yielding instruments such as equities and bonds.
The sell-off was also amplified by rising US Treasury yields and a firmer US dollar, both of which reduce gold’s appeal. Because gold does not offer interest income, higher yields on bonds increase the opportunity cost of holding bullion, while a stronger dollar makes gold more expensive for international buyers.
Despite the correction, gold managed to stabilise as underlying structural drivers remain intact, including geopolitical uncertainties, central bank demand, and ongoing concerns about inflation and financial stability.
Structural Drivers Continue Supporting Gold
Gold’s longer-term outlook remains supported by sustained buying from central banks, particularly across Asia and emerging markets. Many countries have been diversifying reserves away from the US dollar, increasing allocations to gold as a strategic asset.
Central bank demand has become one of the most important pillars supporting gold prices in recent years, helping to offset fluctuations caused by short-term investor sentiment.
Geopolitical tensions, including trade disputes, global elections, and economic uncertainty, continue to reinforce gold’s role as a hedge against systemic risk.
Interest Rate Outlook Remains Key Catalyst
One of the most critical factors influencing gold’s trajectory is the outlook for US Federal Reserve interest rates. Expectations that the Fed may maintain higher rates for longer could limit gold’s upside in the near term.
Conversely, any indication of rate cuts or slowing economic growth could strengthen gold’s appeal, as lower yields reduce the opportunity cost of holding non-yielding assets.
Market participants remain highly sensitive to incoming economic data, particularly inflation readings, employment figures, and central bank communications.
Implications for Asian and Malaysian Investors
For investors across Asia, gold remains an essential portfolio diversifier, particularly during periods of financial market uncertainty. The recent correction may present selective entry opportunities for long-term investors seeking protection against inflation and economic volatility.
In Malaysia and across ASEAN, gold demand remains structurally strong, supported by both retail investors and institutional buyers seeking wealth preservation.
Gold’s performance is closely tied to macroeconomic developments, including currency movements, inflation expectations, and geopolitical risks, all factors that remain highly relevant in today’s volatile global environment.
A Pause, Not a Reversal
Gold’s recent stabilisation suggests the current pullback may represent a temporary correction rather than a fundamental trend reversal. The broader structural drivers supporting gold, including central bank accumulation, geopolitical risks, and global economic uncertainty, remain firmly in place.
While short-term volatility is likely to persist, gold continues to serve as a critical strategic asset for investors seeking resilience amid an uncertain financial landscape.
