Central banks return to net gold buying

Central banks bought a net 55t of gold in June following three straight months of selling. The Central Bank of Türkiye’s return to net buying in June helped the trend in central bank demand remain steadfast. Following three months of net sales, central banks reported net buying again in June 2023.

*Data as of 30 June 2023 where available

Reported net purchases from central banks totalled 55t, the first month of sizeable global net buying since February.

As in recent months, activity from the Central Bank of Türkiye (CBRT) was pivotal to the global total. Having been a significant net seller between March and May in order to meet local demand, it swung back to net buying in June, adding 11t to its official reserves. The CBRT’s total gold reserves stood at 440t at the end of June (29% of total reserves).

The bank’s activity underlined and clarified the continuing trend in central bank gold demand. Six central banks added gold during the month, with only two notable sellers. Among the buyers, the People’s Bank of China was the largest.

It added 21t to its gold reserves during June, the eighth consecutive month of purchases. Since it began reporting increases in November 2022, gold reserves have grown by 165t (+8%), of which 103t has been bought in 2023, making it the largest buyer y-t-d.

The National Bank of Poland (NBP) was another large purchaser in June, increasing its gold reserves by 14t. This is the third consecutive month of buying from the bank, which last year indicated that it planned to add 100t to its gold reserves.

4 The NBP has added 48t y-t-d, pushing its total gold holdings to 277t. Uzbekistan (8t), the Czech Republic (3t), Qatar (2t) and India (1t) were the other notable buyers in June.

At the time of writing, Kazakhstan and Singapore were the only significant (one tonne or more) sellers in June. Kazakhstan’s official gold reserves fell by 3t to 314t (56% of total reserves), with the bank indicating that more selling will likely occur before the end of the year.

5 More frequent buying and selling from banks that obtain gold from domestic sources, such as Kazakhstan, is not uncommon. The Monetary Authority of Singapore reduced its gold reserves by 1t during the month.

Author: Krishan Gopaul, Senior Analyst, EMEA World Gold Council