Central banks buy gold at fastest pace since 2024, WGC says

In the third quarter, central banks worldwide purchased gold at the highest rate since the end of 2024, according to the World Gold Council (WGC). Despite a challenging market due to rising oil prices and interest rates, the institutions amassed a net 321 tonnes of the precious metal. This brought the annual total for the quarter to 675 tonnes, slightly surpassing the same period from the previous year.

The figures highlight the continued importance of central banks as a significant support for gold prices in a market that has otherwise been lackluster. Since the Iran war began, the metal has lost roughly a quarter of its value, as higher energy costs have fueled expectations of tighter monetary policy. Weaker gold prices in the quarter may have motivated some central banks to increase their purchases, according to John Reade, a senior market strategist at WGC.

Around two-thirds of the estimated central bank buying remained undisclosed by the monetary authorities themselves. China and Poland emerged as the biggest disclosed buyers, adding 63 tonnes and 41 tonnes, respectively. Russia was the only major seller, selling 19 tonnes during the period. Despite the downward trend in gold prices, demand for gold-backed exchange-traded funds has been exceptionally strong, with holdings surging by 211 tonnes to a record high in the third quarter.

However, jewelry demand declined by 17%, reaching its weakest level in three years, as tax changes in India and China, coupled with higher prices, led consumers to prefer lighter and lower-carat pieces.