Central Banks Accumulate Record Amount of Gold in Q2

Central bank gold purchases rebounded sharply in Q2, reaching a record high of 288.9 tonnes, according to data from the World Gold Council (WGC). This represents a 62% increase compared to the same period last year and a significant recovery from the weak Q1 numbers. The largest buyer in Q2 was the National Bank of Poland, which acquired 51 tonnes, pushing its total reserves to 82 tonnes for the first half of the year.

The People's Bank of China also increased its gold purchases, buying 41 tonnes and bringing its reported reserves to 2,346 tonnes. Uzbekistan, Kazakhstan, the Central Bank of Jordan, and the Czech Republic contributed to the record demand in Q2, while Turkey and Russia slowed their sales. The WGC's survey anticipates that gold purchases will continue to gain momentum later this year, with 89% of central bankers expecting gold reserves to increase in the next 12 months.

Central banks' interest in gold is largely driven by geopolitical risks, with most institutions planning to continue adding gold to their reserves. The WGC's findings are consistent with reports indicating that China is covertly accumulating gold through London imports that go undeclared as the country shifts from dollars to gold.