Official sector demand stays the spine of the gold market. Since Russia’s invasion of Ukraine in 2022, central banks, significantly throughout rising markets, have accelerated reserve diversification in response to sanctions danger, geopolitical fragmentation and a need to cut back reliance on the US greenback. Crucially, this demand has proved regular and largely worth insensitive.
Poland, the world’s largest reported gold purchaser final 12 months, has signalled additional purchases because it targets the next absolute degree of gold holdings relatively than a hard and fast share of reserves. It is now concentrating on round 700 tonnes of gold, up from roughly 550 tonnes, relatively than a hard and fast 30% share of reserves. This underscores that reserve accumulation stays strategic, not tactical.
China’s central financial institution additionally prolonged its gold shopping for to a fifteenth month in January.
As lengthy as geopolitical fragmentation persists, a significant reversal in central financial institution gold demand seems to be unlikely. This structural flooring continues to underpin the market at elevated worth ranges.
