Gold prices in the Philippines dropped on Wednesday, according to FXStreet data. The price per gram fell to 8,510.35 Philippine Pesos (PHP), down from 8,567.24 PHP the day before. The price per tola also decreased to PHP 99,263.27, down from PHP 99,926.58. Gold prices in the Philippines reflect international prices, adjusted using the USD/PHP exchange rate. These rates are updated daily and can vary locally.

The Role of Gold as a Store of Value

Gold has been a reliable store of value throughout history, especially in uncertain times. In 2022, central banks, the biggest buyers, purchased 1,136 tonnes of gold worth about $70 billion—the highest annual increase ever. Gold typically moves in the opposite direction of the US Dollar and Treasuries. When the Dollar weakens, gold’s value usually rises, offering diversification during market turbulence. Prices can be influenced by factors like geopolitical issues and interest rates. A weaker Dollar generally boosts gold prices, while a stronger Dollar can bring them down. Recently, local gold prices saw a slight dip, but this is likely a temporary blip in a larger global trend. The main factor driving gold prices is its value in US dollars, affected by major economic influences. For traders, focusing on these daily fluctuations is crucial for positioning themselves over the coming weeks. The market is now fully expecting the Federal Reserve to keep cutting rates, a trend that began in late 2025. However, the latest inflation data from December 2025 revealed that core CPI remained stubborn at 3.2%, surprising analysts who anticipated a figure closer to 3.0%. This mix of expected lower rates and enduring inflation supports a non-yielding asset like gold.

Pressure on the US Dollar

This situation has put ongoing pressure on the US dollar, a significant factor in driving gold prices higher. We have seen the US Dollar Index (DXY) decline from its 2025 highs above 104 to consistently trading below 100 this year. A weaker dollar makes gold more affordable for foreign buyers, providing a boost for the metal. Additionally, we can’t overlook the strong demand from central banks. After record purchases in previous years, final data for 2025 showed that central banks added over 1,000 tonnes to their reserves, with emerging markets leading the shift away from the dollar. This consistent buying underpins gold prices and reflects confidence from major institutions worldwide. With riskier assets like the S&P 500 struggling to gain momentum after a strong rally in late 2025, traders should consider gold as a key protective asset. Ongoing geopolitical tensions from last year also keep demand for safe-haven assets high, making gold derivatives a smart choice for portfolio protection. Thus, we believe traders should use this slight dip as a chance to buy long-dated call options to capture potential gains in the spring. Using gold futures for leveraged long positions is also a strategic option, especially with important inflation reports and Fed meetings approaching. Any additional weakness in the Dollar should be viewed as a solid opportunity to increase exposure. Create your live VT Markets account and start trading now.

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