Gold Holds Above $4,000 as Central Banks Continue Reserve Diversification
Gold prices held steady above $4,000 per ounce despite a week of fluctuations. The metal ended Friday at $4,144.04 an ounce after shedding 3.4 percent in the previous week.
The decline was largely driven by changes in the bond market, where rising US Treasury yields and firmer oil prices led to a pullback in futures positioning.
However, the strategic reallocation of foreign exchange reserves away from dollar-denominated assets remains a key factor supporting gold's price. The People's Bank of China continues to lead this charge, adding 20.2 tons to its official holdings in August, its largest monthly purchase since October 2023.
Other central banks are also diversifying their reserves, with Ghana's official gold reserves climbing from 24.4 tons in June to 25.2 tons in August. Smaller monetary authorities are following suit, with private investors' hedging demand and continued central bank purchases driving the market.