Trade Ministry: US Bond Yield Rise Triggers HPE Gold Decline

Illustration - Gold commodities (Dok. ICDX)

JAKARTA - The Ministry of Trade (Kemendag) said that the decline in the export benchmark price (HPE) and the reference price (HR) of gold in the first period of July 2026 occurred due to the strengthening of the exchange rate of the United States dollar (USD) and the increasing yield of US government bonds.

HPE gold fell 5.36 percent to 135,512.62 US dollars per kilogram from 143,190.64 US dollars per kilogram in the second period of June 2026. HR gold also fell to 4,214.92 US dollars per troy ounce (t oz) from 4,453.73 US dollars per t oz. During the data collection period, HPE gold fell by 5.36 percent.

"The decline in gold HPE and HR is influenced by the strengthening of the US dollar exchange rate and the increase in the yield of US government bonds," said Director General of Foreign Trade at the Ministry of Trade Tommy Andana in a statement in Jakarta, Wednesday.

He explained that this had encouraged investors to shift their investments from gold to financial instruments with more attractive potential returns.

In addition, the interest rate policy which is still at a high level also puts pressure on gold prices because the commodity does not provide returns in the form of interest or dividends.

In the end, continued Tommy, investors tend to switch to investment instruments with interest that offer a more certain rate of return.

This investment shift then has an impact on weakening demand for gold in the global market. Meanwhile, the supply of gold remains maintained amid declining demand triggers a correction in gold prices in the international market and has an impact on the decline in gold HPE and HR.

Gold HPE and HR are determined based on data and technical input from the Ministry of Energy and Mineral Resources (ESDM) which refers to the London Bullion Market Association (LBMA) publication.

The determination of gold HPE and HR is the result of cross-ministerial and inter-agency coordination by considering various data, information, including input from the Coordinating Ministry for Economic Affairs, the Ministry of Energy and Mineral Resources, the Ministry of Finance, and the Ministry of Industry.