Purchased 800t by Q3 This Year
15% Increase in Purchases Compared to Last Year
International Gold Price Surpasses $2000 per Ounce
The amount of gold purchased by global central banks this year has increased by about 15% compared to a year ago. This is analyzed as a move to buy gold, a traditional safe-haven asset, amid increased currency value volatility caused by inflation and a strong dollar. International gold prices continue to show strength, surpassing $2,000 per ounce.
According to a report by the World Gold Council (WGC) on the 1st, central banks around the world purchased 800 tons of gold from January to September this year. This is a 14% increase compared to the same period last year.
The quarterly purchase volumes this year were 288 tons in Q1, 175 tons in Q2, and 337 tons in Q3. While the gold purchase volume reported by central banks to the International Monetary Fund (IMF) was 129 tons in Q3, the WGC estimated the actual purchase volume to be much higher at 337 tons. In particular, it is reported that the gold purchases by China and Russia were significantly higher than the figures officially reported to the IMF.
By country, it was identified that central banks of major players in the gold market, including China, Poland, and T?rkiye, were actively purchasing gold. The WGC predicted that the total gold purchases by central banks this year could exceed last year’s level of 1,081 tons.
The decline in currency value due to global inflation and the strong dollar (King Dollar) caused by interest rate hikes by the U.S. Federal Reserve (Fed) is analyzed as a reason for buying gold as a store of value. The international situation, including the war between Israel and the Palestinian armed group Hamas and Western sanctions against Russia, is also cited as a cause for the increased demand for gold.
Especially, emerging countries such as China and T?rkiye are noted as central banks actively purchasing gold. These countries, seeing the West freeze Russia’s financial assets as part of sanctions against Russia, have purchased physical gold and brought it into their countries for direct possession.
The People's Bank of China, a major player in the international gold market, is leading the gold buying trend among central banks worldwide. As China’s economic slowdown accelerates due to yuan weakness, stock market sluggishness, and real estate market contraction, Chinese individual investors are also expanding gold investments following the People's Bank. One foreign media outlet reported, "China has been leading central bank gold purchases this year," adding, "Central banks around the world are turning to gold to hedge against inflation and reduce dependence on the U.S. dollar."
As demand for gold investment expands, international gold prices have also strengthened, surpassing $2,000 per ounce. According to Bloomberg News, at the end of October, the international spot gold price traded at $2,000.07 per ounce, up 8.19% ($151.44) compared to the end of September.
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