Published: 2019.12.12. A new record for gold purchases by the Central Banks

A new record for gold purchases by the Central Banks - Preview

Demand for gold from the Central Banks has reached a new record this year, although there has been a slight decrease in recent years. But overall, demand will remain stable. This was reported by Kitco News, citing analyst Matthew Turner.

According to the expert, gold purchases from the Central Banks from January to October this year amounted to a total of 550 tons, which is already 17 tons the most in 2018. It is worth recalling that in the last 2018, a record was set for this indicator over the previous 50 years.

According to Turner, at the beginning of this 2019, the gold market received strong support from the Central banks, which in the first half of the year bought 390 tons for the reserves of their countries, but in the second half of the year there was a slight decrease in purchases, and by October 160 tons had been bought.

The analyst believes that a significant decrease in gold purchases is associated with Russia and China, which reduced the volume of purchases. For example, the Central Bank of Russia has reduced purchases of yellow precious metals on the foreign market in order to support Russian gold mining companies. In addition, the month of October was the first since December 2018, when the People's Bank of China did not buy gold for state reserves.

The analyst points out that without the activity of Russia and China in the gold market, the overall picture would not be so optimistic. This is primarily due to the high cost of precious metals, which greatly complicates the diversification of reserves. “But the first half of the year was really phenomenal, although even now the overall picture looks positive,” Turner said. He is confident that the Central Banks have not yet satisfied their appetite for gold, which means that in subsequent years you can count on continued purchases on their part.