Insights 
VT 
Gold prices in Saudi Arabia rose to 514.37 Saudi Riyals (SAR) per gram, compared to 512.69 SAR on Friday, based on FXStreet data. The price per tola increased to SAR 5,999.42, up from SAR 5,979.96.
FXStreet updates these prices daily, factoring in international prices and currency exchange rates. Gold’s performance is supported by its use as a store of value and its role as a safe-haven asset during times of economic uncertainty.
Central Bank Reserves
Central banks hold the most Gold, boosting their reserves by 1,136 tonnes, valued around $70 billion, in 2022. This was their largest annual purchase recorded, with emerging economies like China and India rapidly expanding their reserves.
Gold prices typically rise when the US Dollar weakens, as these assets are inversely related. A fall in the stock market tends to increase Gold’s value, while geopolitical instability also raises prices due to its safety appeal.
Gold’s price is influenced by several factors, including interest rates and currency strength. It often increases when interest rates are low and is an appealing choice when the Dollar depreciates. FXStreet cautions that these market assessments carry risks and uncertainties.
With gold prices showing a modest increase today, October 20, 2025, we are seeing signs of underlying strength. This move appears linked to a slight softening in the US Dollar ahead of key inflation data expected later this week. Derivative traders should note this classic inverse relationship is currently in play.
Market Dynamics and Strategies
The Federal Reserve’s recent signals of a potential pause in rate hikes have created market uncertainty, which typically benefits non-yielding assets like gold. Looking at the latest Commitments of Traders report, we see large speculators increasing their net-long positions in gold futures. This suggests a growing expectation of higher prices if the Fed confirms a more dovish stance in its November meeting.
Escalating trade frictions between the US and China are also adding to global market turbulence, pushing capital towards safe-haven assets. This has increased gold’s implied volatility to its highest level in three months, making strategies like straddles potentially more attractive for those expecting a significant price move. We saw similar volatility spikes during the trade disputes of the late 2010s, which often preceded sharp rallies in the gold price.
We must also consider the persistent demand from central banks, which provides a strong fundamental floor for the price. The World Gold Council’s latest data for the third quarter of 2025 showed that central banks added over 215 tonnes to their reserves. This continues a multi-year trend we’ve observed since the record-breaking purchases back in 2022, absorbing market supply and supporting a bullish long-term outlook.
Given the combination of geopolitical risk and potential monetary policy shifts, we believe establishing bullish positions with defined risk is a prudent approach. Consider buying call options or implementing bull call spreads on December gold futures to capitalize on potential upside through the end of the year. This strategy allows traders to benefit from a price rally while limiting premium costs and overall risk exposure.
