Central Banks Cut Gold Buys Amid Eurozone Inflation Surge
The World Gold Council (WGC) has released revised figures showing that central banks purchased significantly less gold in the first quarter of 2026 than previously thought. The estimated gold purchases were revised down from 244 tonnes to 57 tonnes, marking a sharp decline compared to previous years. This downward revision is attributed to the increased difficulty in tracking central bank activity, with major buyers like China disclosing only a portion of their gold purchases.
Despite this decline, total gold demand remains strong, reaching 2,522 tonnes in the first half of the year, a 2% increase from last year. However, due to the higher gold price, the value of that demand rose to a record $380 billion. The WGC expects investment demand to remain the main growth driver in the second half of the year.
In other economic news, inflation has risen again across the eurozone, with an average rate of 2.9%. This increase is attributed to rising energy and motor fuel prices, which have increased by almost 10% compared to last year. The European Central Bank (ECB) may raise interest rates in response to these rising inflation numbers.