Gold industry market development organisation, the World Gold Council (WGC), reports that central banks’ monthly net gold purchases increased in January and February, following December’s five-month low.
So far this year, only five countries have increased gold reserves by at least 1 t. This includes Turkey, which bought 41 t, Russia with 19 t, the United Arab Emirates with 5.9 t, Kazakhstan with 2.8 t and Mongolia with 1 t.
However, WGC market intelligence manager Krishan Gopaul points out that central bank gold demand has eased significantly, with net gold purchases down 44% compared with the strength of demand experienced in January and February 2019.
“Looking ahead, what we do know is that recent market instability and uncertainty stemming from the Covid-19 pandemic will be at the forefront of central bankers’ minds, with a number of unprecedented interventions already proving this point.
"Nonetheless, we will have to wait and see how this impacts their outlook in the coming months,” he says.