Home > Boards > Free Zone > Industry Specific > Metals and Mining Sector Ideas

>>> Central Banks Are on the Biggest Gold-Buying

Public Reply | Private Reply | Keep | Last ReadPost New MsgNext 10 | Previous | Next
gfp927z Member Profile
Followed By 59
Posts 19,741
Boards Moderated 55
Alias Born 03/22/05
160x600 placeholder
gfp927z   Sunday, 02/03/19 11:32:50 AM
Re: None
Post # of 125 
>>> Central Banks Are on the Biggest Gold-Buying Spree in a Half Century


By Rupert Rowling and Susanne Barton

January 31, 2019


Central banks had second-largest year of purchases on record

Demand for haven in Europe also aided demand in 2018, WGC says

Central banks bought more bullion last year than anytime since 1971, when the U.S. ended the gold standard.

Governments added 651.5 tons of gold to their coffers in 2018, a 74 percent increase from the previous year, according to a report from the World Gold Council.

Russia, which is "de-dollarizing" its reserves, was the biggest buyer, followed by Turkey and Kazakhstan. Hungary also made a large purchase, citing gold’s lack of counterparty risk and role as a hedge against changes in the international finance system, the WGC said.

“Central banks chose to significantly increase their gold reserves, reinforcing the importance of gold as a reserve asset,” the WGC said.

Prices have rallied to the highest since May

Central banks are expected to acquire an additional 600 tons this year, according to the consulting firm Metals Focus Ltd. The buys, which will help the banks diversify their foreign-exchange assets in a time of extraordinary political volatility, signal a growing confidence in the metal’s value moving forward.

Read: Central Bankers’ Hunger for Gold Could Signal Price Turnaround

The banks "were not net buyers even a decade ago," said Juan Carlos Artigas, director of investment research at the WGC, in a telephone interview. "As their foreign reserves expand, they are increasingly diversifying away from pure dollar exposure."

Slowing global growth, a weaker U.S. dollar and a drive by central banks to expand the amount of gold they hold could be a winning trifecta for investors seeking a recovery in the metal’s price after its first annual loss in three years.

Gold prices ended 2018 little changed, but rallied toward the end of the year amid concerns about Brexit, a falling stock market and expectations for a less aggressive U.S. monetary policy. The trend has continued this month, with bullion climbing to the highest since May.


Global gold demand rose 4% to 4,345.1 tons

Bar and coin demand rose 4% to 1,090.2 tons, with coin purchases at a five-year high.

Global ETF inflows fell 67%, but were up for the year in Europe.

Jewelry demand was steady, and total supply was little changed.


Public Reply | Private Reply | Keep | Last ReadPost New MsgNext 10 | Previous | Next
Follow Board Follow Board Keyboard Shortcuts Report TOS Violation
Current Price
Detailed Quote - Discussion Board
Intraday Chart
+/- to Watchlist