The factors determining gold prices are divided into long-term and short-term influences. Long-term factors hinge on the US fiscal deficit rate and the government debt and creditworthiness it represents, while short-term factors depend on the degree of monetary policy easing.
After touching a recent low earlier this week, international gold prices have staged a consecutive rebound. As of 2:00 PM Beijing Time on March 25, 2026, both spot London gold and COMEX gold futures have firmly held above $4,500 per ounce.
The improvement in market sentiment quickly spread to domestic capital markets. Data from Tonghuashun shows that the precious metals sector in the A-share market performed notably well on March 25. The sector's intraday gain once exceeded 5.5% in the morning session. Although the overall gain moderated later, the sector still closed with a composite increase of over 2.5%, attracting approximately 1 billion yuan in net inflows from main funds.
Stocks within the sector generally rose. Among them, Chifeng Gold (600988.SH) saw its intraday surge peak at over 9%. Other stocks like Xiaocheng Technology (300139.SZ) and Zhongjin Gold (600489.SH) were also active. Following a period of adjustment, capital appears to be once again seeking out definitive opportunities in the gold sector.
Beyond geopolitical influences, a key driver behind the broad rebound in gold stocks is Zijin Mining Group's acquisition of Chifeng Gold. This highly anticipated M&A deal initially caused a sharp decline in both companies' share prices the day after the announcement. Market concerns primarily centered on the acquisition premium, short-term financial pressure, and uncertainties regarding resource integration. However, as these short-term negative sentiments were gradually digested, the market began re-evaluating the deal with a longer-term perspective.
According to the recently disclosed 2025 annual reports of both companies, Zijin Mining's consolidated gold resources amounted to a significant 4,610.48 tonnes, with gold reserves of 1,996.25 tonnes as of the reporting period end. Chifeng Gold reported consolidated gold resources of 583 tonnes. This acquisition paints a highly promising picture for Zijin Mining's resource reserves and production capacity data. Based on 2025 data from the Mining Committee of the China-Asia Economic Development Association on the top ten global gold mining companies, successfully consolidating Chifeng Gold would position Zijin Mining's annual output second only to Newmont Corporation (2025 capacity: 5.89 million ounces), elevating it to the global number two spot.
In recent years, this mining giant has been using gold as a foundation to accelerate expansion into other critical mineral sectors like copper, lithium, and molybdenum, building an industrial system for synergistic multi-category resource development. For its copper business, the Phase II expansion project at the Tibet Jilong Copper Mine has been completed and operational, achieving an annual copper production capacity of 300,000-350,000 tonnes, while preliminary work for Phase III is actively advancing. In lithium resources, its Argentina 3Q Lithium Salt Lake, Tibet Lagkor Co Lithium Salt Lake, and Hunan Xiangyuan Lithium Mine all commenced concentrated production in 2025. The northeastern section of the Manono Lithium Mine in the Democratic Republic of Congo is planned to begin production in June 2026. Regarding molybdenum metal, it holds a controlling stake in the Anhui Shapinggou Molybdenum Mine, one of the world's largest single molybdenum deposits by reserves, with a molybdenum production target of 15,000 tonnes for 2026, aiming to increase to 25,000-35,000 tonnes by 2028.
While Zijin Mining's diversified landscape becomes increasingly clear, the value of any mining company is ultimately tied to the broader macroeconomic backdrop. For gold, a unique asset with both commodity and monetary attributes, its price fluctuations are closely linked to complex international dynamics.
The factors determining gold prices are divided into long-term and short-term influences. Long-term factors hinge on the US fiscal deficit rate and the government debt and creditworthiness it represents, while short-term factors depend on the degree of monetary policy easing.
From this framework, it becomes understandable why gold prices initially fell following the outbreak of the Iran-US conflict, a geopolitical risk. In the short term, the conflict significantly drove up oil prices, reigniting inflation expectations that had previously been moderating. The Fed's relatively hawkish stance at its March FOMC meeting, expressing concerns that resurgent inflation could lead to expectations of interest rate hikes in 2026, greatly constrained the potential for monetary policy easing, directly impacting gold. Simultaneously, US efforts to alleviate its own debt and credit crisis by strengthening control over resource-rich nations, and the initial display of military advantage during the conflict's early stages, temporarily boosted the US dollar index, thereby challenging gold's long-term pricing logic.
Regarding gold's long-term trajectory, optimism remains. The current Iran-US conflict is seen as gradually turning into a war of attrition, with the difficulty for the US and its allies to fully subdue Iran being far greater than anticipated. The ultimate outcome will likely revert to a pattern of intermittent fighting and repeated negotiations. This process, rather than demonstrating past US hegemony, is expected to further accumulate debt and erode US creditworthiness. Furthermore, whether to ease the government's debt servicing burden or to support the development of new industries like AI, sustained monetary tightening in the US is considered difficult to maintain. Interest rate cuts are still viewed as the predominant medium to long-term trend.