(Mike Maharrey, Money Metals News Service) Record prices haven’t dulled central banks’ appetites for gold. Globally, central banks officially added another net 24 tonnes of gold to their reserves in February, according to the latest data released by the World Gold Council.
Poland was the biggest buyer in February, adding another 29 tonnes of gold to its reserves. The National Bank of Poland now holds 480 tonnes of the yellow metal, making up 20 percent of its reserves.
Last year, the Polish central bank expanded its gold holdings by 90 tonnes, leading all buyers.
It will be interesting to see if Poland continues to add to its gold holdings. In 2024, National Bank of Poland Governor Adam Glapiński indicated the central bank planned to increase its gold holdings to 20 percent of its reserves.
“This makes Poland a more credible country, we have a better standing in all ratings, we are a very serious partner, and we will continue to buy gold.”
The People’s Bank of China publicly returned to the table in November after a six-month pause in reporting gold purchases. The Chinese central bank was the second-biggest buyer in February, adding another 5 tonnes of gold to its official reserves. That pushed its official gold holdings to 2,285 tonnes, about 6 percent of its total reserves.
Notice the emphasis on “official.”
The Chinese likely hold significantly more gold than they publicly disclose. As Jan Nieuwenhuijs has reported, the People’s Bank of China is secretly buying large amounts of gold off the books. According to data parsed by the renowned Money Metals researcher, the Chinese central bank is currently sitting on more than 5,000 tonnes of monetary gold located in Beijing – more than TWICE what has been publicly admitted.
The Turkish central bank returned to buying in February after a pause in January, adding 3 tonnes of gold to its official holdings. Turkey ranked second in gold buying among central banks in 2024, expanding its reserves by 74.8 tonnes. The Turks now own 623 tonnes of gold, making up about 38 percent of their reserves.
The following central banks also reported gold purchases of at least 1 tonne in February:
- Jordan – 3 tonnes
- Qatar – 2 tonnes
- Czech Republic – 2 tonnes
There were some notable sellers. The National Bank of Kazakhstan sold 8 tonnes of gold, and the Central Bank of Uzbekistan trimmed its gold holdings by 12 tonnes. Uzbekistan was the biggest buyer in January. It is not uncommon for banks that buy from domestic production – such as Uzbekistan and Kazakhstan – to switch between buying and selling.
Russia also decreased its gold holdings modestly.
Official central bank gold demand topped 1,000 tonnes for the third straight year in 2024. To put that into perspective, central bank gold reserves increased by an average of just 473 tonnes annually between 2010 and 2021.
On net, central banks officially increased their gold holdings by 1,044.6 tonnes last year. It was the 15th consecutive year of expanding gold reserves.
Last year was the third-largest expansion of central bank gold reserves on record, coming in just 6.2 tonnes lower than in 2023 and 91 tonnes lower than the all-time high set in 2022. (1,136 tonnes). 2022 was the highest level of net purchases on record dating back to 1950, including since the suspension of dollar convertibility into gold in 1971.
The World Gold Council summed up the current central bank demand.
“Central banks continue to play a pivotal role in global gold demand, with their purchasing patterns influenced by both economic and geopolitical shifts. The shift from armed conflict to broader economic tensions has reinforced their net buying trend, especially apparent since 2022. Many central banks appear to have strategically leveraged temporary price pullbacks as buying opportunities, while sales have remained limited and largely tactical during price rallies.”
Mike Maharrey is a journalist and market analyst for Money Metals with over a decade of experience in precious metals. He holds a BS in accounting from the University of Kentucky and a BA in journalism from the University of South Florida.