Central Banks Flock to Gold Amid Price Volatility
Central banks around the world are aggressively buying gold in response to recent price volatility. According to the World Gold Council, net purchases reached 289 tonnes in the second quarter of this year, a figure worth approximately $47.38 billion.
Poland led buyers with 51 tonnes while China added 33 tonnes during the same period. The People's Bank of China continued purchasing into July with nearly 20 tonnes added amid the price pullback.
The buying surge coincided with a 14% drop in gold prices from January highs, creating an accumulation window for official institutions. Western ETF investors reduced holdings during this time as well.
Gold is currently trading at $4,648 per ounce. J.P.Morgan forecasts the yellow metal could hit a price of $6,000 by year-end, representing a potential 29% gain.