What Do Gold Leasing Rates Say About Markets?

Summary

• Just as higher Treasury yields signal uncertainty because of higher risk for holding US debt, gold leasing rates are up because market confidence, especially in the US economy, is cratering.
• Gold leasing is tied to the gold carry trade, where borrowers profit from the difference between lease rates paid to lease the gold and interest rates earned by investing the sale proceeds.
• Gold leasing adds liquidity into the market and influences bullion prices. Gold leasing rates reflect the cost of borrowing gold, which can have a push-and-pull effect on the gold market and are an economic indicator beyond the price of gold itself.

Originally published on May 24, 2025

In 2025, gold leasing rates surged, partially from increased gold demand and tightening supply. That’s because confidence in gold is up and confidence in the global economy is crashing.

Institutions like the “bullion banks” at JPMorgan