Central bank gold demand soars in July as prices climb

Central banks worldwide significantly boosted their gold reserves in July, even as gold prices rose, according to a report by Krishan Gopaul, a senior analyst for the EMEA region at the World Gold Council (WGC).  

According to the report, there was a 206% increase in net gold purchases compared to June, driven by strategic decisions from several central banks seeking to diversify their reserves amid ongoing economic uncertainties.  

The latest data from the WGC shows that net gold purchases by central banks in July reached 37 tonnes.  

According to the data, the National Bank of Poland led the buyers, adding 14 tonnes to its reserves.  

This brought Poland's total gold holdings to 392 tonnes, which now constitutes 15% of its total reserves.  

Poland’s substantial purchase highlights its strategy to strengthen its financial stability through gold.  

Other central banks also played a significant role in the increase in gold demand.  

According to the Central Bank of Uzbekistan, it purchased 10 tonnes of gold in July, marking the second consecutive month of accumulation.  

This move shifted Uzbekistan's position for the year from a net seller to a net buyer of gold.  

Similarly, the Reserve Bank of India (RBI) continued its steady gold accumulation, purchasing an additional 5 tonnes in July.  

According to this, India's total net gold purchases for 2024 now stand at 43 tonnes, underscoring its commitment to gold as a key part of its reserve strategy.  

Despite the rise in gold prices, central banks have remained steadfast in their gold-buying strategies.  

According to Gopaul’s analysis, the consistent trend of net gold purchases reflects strong confidence in gold as a reliable store of value, especially during periods of economic uncertainty.  

The report concludes with an expectation that this trend of increasing gold reserves will likely persist, as central banks aim to ensure stability in a volatile global economic landscape.