Central Banks Buy 63 Tons of Gold in Highest Monthly Pace Since 2024

Central banks purchased approximately 63 tons of gold last September, reaching the highest monthly level since November 2024, reflecting the ongoing effort by monetary institutions to bolster their reserves of the yellow metal.

Holdings of the Chinese central bank reached around 2,410 tons, equivalent to approximately 9% of its reserves, according to XTB data. A survey showed that a record 45% of central banks expect to increase their gold reserves over the coming year.

The purchases came despite a recent sell-off that hit gold prices, indicating that long-term institutional demand remains intact. Conversely, some countries resorted to selling a portion of their gold to provide liquidity following the onset of the war between the United States, Israel, and Iran.

Central bank purchases are seen as a key pillar supporting the gold market, as they rely on reserves held for long periods and are not as affected by daily price fluctuations as retail investors are.

What Do These Terms Mean?

Gold Reserves: The amount of the metal held by a country's central bank among its assets, used to support the currency and boost financial confidence.

Liquidity: The availability of cash or assets that can be quickly converted into cash to cover obligations and expenses.

Central Bank: The institution that manages a country's monetary policy, oversees banks, and controls currency issuance.