Asian gold producers adopt domestic-refining drive to retain metal value

Federal Reserve tightening and higher long-term yields are currently the dominant factors for gold. Any rallies are likely to be capped by expectations of additional rate increases until the trajectory of US interest rates becomes more defined. Resource nationalism represents a slower-moving supply development, one that supports buying on weakness over a multi-year timeframe. If more producing nations refine domestically and limit outbound shipments, the quantity of gold accessible to international refiners and the London market could diminish. That scenario would heighten price sensitivity to central bank and investment demand. Persistent official buying, led by China, provides a consistent demand base that cannot be erased by interest rate movements alone.

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Previously, the $4,000 level was debated:

• Oil is gold's biggest enemy right now, Bank of America warns. Downside risk under $4000.
• Morgan Stanley's Gower sees $4,000 as a strong floor for gold, cites three supports

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Gold producers across Asia have realised what colonial-era powers once understood: the true value is in holding onto the metal instead of exporting the raw ore.

Summary:

• Asian gold producers are increasing domestic refining, taxing exports and adding to central bank reserves to capture more benefit from the price surge.
• Laos plans to refine its own output via the Lao Bullion Bank. Indonesia will apply a gold export tax of up to 15% from 2026.
• China's central bank extended its record purchase streak to 22 months as of August. Comparable efforts are ongoing in Africa.
• Reduced confidence in the dollar and sanctions risks are boosting gold's attraction as a reserve asset.
• In the near term, gold faces pressure from Fed rate increases and climbing yields, but the long-term trend could support prices.

Countries across Asia that produce gold are increasingly seeking to retain more of their metal domestically, according to Nikkei Asia (gated). They are expanding local refining capacity, imposing export taxes and boosting central bank purchases in a resource-nationalist wave that could eventually constrict global supply.

This change follows a strong rally. London spot gold reached an all-time high above $5,500 an ounce in January and stays above $4,000. Weakening trust in the dollar as the world's primary reserve currency is enhancing gold's attractiveness, especially after sanctions froze dollar assets belonging to countries at odds with Washington.

For a long time, Laos saw its gold leave as low-value ore. Now it aims to refine its production domestically, with the Lao Bullion Bank, established in 2024, playing a central role. The country produced roughly 12 tons in 2025, the World Gold Council reports, and estimates its reserves at between 500 and 1,000 tons.

Indonesia, which extracts over 100 tons annually, will introduce an export tax on gold of as much as 15% starting in 2026. China, the biggest producer, generally bars gold exports, and its central bank stretched its run of net acquisitions to a record 22 months in August. Comparable developments are happening in Africa, including in Madagascar and Ghana.

The upshot could be less metal available in international circulation. A precious metals consultancy cautioned that the trend will affect major refiners' capacity to source gold.

Gold faces near-term headwinds. Prices dropped to roughly $4,100 on September 28, around 12% below the late-August peak close to $4,700. They have been dragged down by rising long-term yields and by expectations of additional US rate increases, following the Federal Reserve's September hike — its first in more than three years. That strain is likely to continue until the peak in US rates becomes clearer.

Over the longer term, however, ANZ's Geullim Yum said producer-country actions could become another element pushing gold prices higher.