Central Banks Hoard Gold at Record Pace, Driving Price to All-Time High

Central banks have dramatically shifted from massive selling to historic hoarding of gold. The world has entered an era of aggressive accumulation, with global official gold reserves hitting a record high of approximately 36,600 tonnes.

Poland is leading the buying pace as part of its national strategy to push gold to 20% of its total currency reserves. China continues to accumulate gold at a multi-year rate, raising its official reserves past 2,330 tonnes. Other countries like Guatemala, Cambodia, Indonesia, Malaysia, the Czech Republic, and Serbia have entered or returned to the market.

Countries are buying gold because they want their reserve assets free from foreign sanctions/freeze risks and aim to reduce long-term reliance on fiat currencies like the U.S. dollar. Central bank net gold purchases generally fall into three distinct historical phases: decades of selling, 2008-2019's shift to buying, and since 2022's accelerated pace.

Following the freezing of Russia's foreign currency reserves in 2022, central banks doubled their historical buying pace to over 1,000 tonnes a year, sparking an unprecedented multi-year bull run. Between 2022 and 2024, global central bank net purchases more than doubled, continuously smashing through historic levels by exceeding 1,000 metric tons each year.