Global investment firm Jefferies released a report indicating that gold has entered a consolidation phase following a surge in retail-driven buying late last year and early this year in major markets such as India, China, and the United States.
The report observed that the previous rally in gold demand, particularly among retail investors, is moderating, reflecting a stabilization of prices after a period of heightened activity. Jefferies stated, “gold has entered a healthy consolidation period after the retail-driven buying frenzy late last year and early this year.”
Focusing on India, the report highlighted that gold imports reached $14.7 billion in October and $12.1 billion in January. However, there was a sharp decline in imports, dropping to $3.1 billion in March, which signifies a slowdown in purchasing momentum.
Describing the current market phase, Jefferies referred to it as a “healthy consolidation period” following the earlier surge in demand, suggesting the market is adjusting in the aftermath of the retail-led rally. From the perspective of gold mining, the report noted a notable lack of excessive optimism in recent industry discussions.
The report emphasized that mining companies are prioritizing shareholder returns through increased dividends and stock buybacks instead of pursuing aggressive expansion strategies. This shift contrasts with the previous bull market in gold mining stocks, which peaked in 2011, a time when considerable capital was lost due to acquisitions made at market highs.
Despite favorable price conditions, mining companies are demonstrating continued discipline in capital allocation. The sector has experienced ten consecutive quarters of strong average gold prices, with many firms functioning without debt.
Estimates in the report suggest that the North American gold mining sector is expected to generate approximately $36 billion in free cash flow for the current calendar year. Based on these trends, Jefferies intends to maintain its exposure to gold mining stocks, with weightings of 10 percent in global portfolios and 11 percent in Asia ex-Japan portfolios.
The firm indicated it may consider increasing its exposure should gold prices return to the lower end of the current trading range, estimated between $3,800 and $4,000 per ounce, compared to a peak of $5,595 per ounce recorded in late January. Current gold prices are trading at $4,804 per ounce (1 ounce = 28.3495 grams). The report suggests that while the gold market is undergoing consolidation, the underlying fundamentals in the mining sector remain robust, bolstered by disciplined capital management and strong cash flow generation.
Published on April 17, 2026.
