Demand Decline Causes Gold Prices to Fall Again

Gold (unsplash)

JAKARTA - The Ministry of Trade (Kemendag) said that the decline in demand for precious metals in the global market has again made the export benchmark price (HPE) and reference price (HR) for gold commodities in the first period of August 2026 weaker.

Director General of Foreign Trade at the Ministry of Trade Tommy Andana said the decline in gold HPE and HR occurred due to the strengthening of the exchange rate of the global major currencies as well as the increase in bond yields in the international market.

Then, the interest rate policy which is still at a high level also puts pressure on gold prices because gold does not provide periodic returns, so investors switch to other instruments with more measurable risks and profits.

"This shift in investment has a direct impact on the decline in demand for gold in the global market. With the world's gold supply remaining adequate, this situation creates pressure that triggers a price correction in the international market," said Tommy, quoting Antara.

Gold HPE was set at 130,921.50 US dollars per kilogram or down 0.7 percent from the second period of July 2026 which was 131,839.51 US dollars per kilogram. Gold HR also fell to 4,072.12 US dollars per troy ounce (t oz) from 4,100.67 US dollars per t oz.

During the data collection period, the gold value fell by 0.7 percent. Overall, this series of factors ultimately led to a decline in the gold HPE and HR period I August 2026.

HPE and gold HR are set in the Minister of Trade Decree Number 1669 of 2026 concerning the Export Reference Price and Reference Price for Mining Products Subject to Export Duty. The Kepmendag is valid for the period 1-14 August 2026.

Gold HPE and HR are also 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 carried out through cross-ministerial and inter-agency coordination based on information, data, and input submitted by the Coordinating Ministry for Economic Affairs, the Ministry of Energy and Mineral Resources, the Ministry of Finance, and the Ministry of Industry.