Gold demand amongst the world’s central banks remained lively in July, according to latest data from the World Gold Council (WGC).
Institutions added 55 tonnes of the yellow metal to their reserves last month, continuing a recent uptick in buying activity.
The WGC said that “having reported a return to net buying in June, the latest data shows global central banks continued to add to their gold reserves in July.”
The body said that central banks bought 85 tonnes in June, which followed three consecutive months of net selling.
While July’s levels were down month on month, the WGC said that “the latest data does seem to support our view that the longer-term buying trend remains in place.”
Big Moves By A Few Banks
The WGC said that two things were notable about central bank activity last month. It said that “relatively few banks altered their gold holdings in July,” and added that “many that did buy/sell did so sizeably.”
It said that the People’s Bank of China (PBoC) was the largest buyer in July, sucking up 23 tonnes of the precious metal. It is also the biggest purchaser in the year to date with total purchases hitting 126 tonnes.
The WGC commented that “since it began regularly reporting gold buying in November, the PBoC has bought a net 188 tonnes, lifting its total gold reserves to 2,136 tonnes.”
China’s central bank was followed closely by the National Bank of Poland last month. In July it purchased 22 tonnes of gold, taking the institution’s total reserves to 299 tonnes.
The Eastern European central bank has bought 71 tonnes between April and July. It is now 29 tonnes short of the 100-tonne increase it announced it had targeted back in early 2021.
Elsewhere, the Central Bank of Turkey added an extra 17 tonnes of gold to its reserves in July. But for the year to date it remained a net seller due to heavy selling between March and May. Net sales during the first seven months of the year totalled 85 tonnes.
The WGC said that “gold import quotas were reinstated in early August so it remains to be seen whether this will lead to renewed selling from the central bank should local gold demand remain elevated.”
Qatar’s central bank bought 3 tonnes of metal in July, while Singapore and Czechia both purchased 2 tonnes of the sentimental commodity.
At the other end of the scale, Uzbekistan and Kazakhstan sold 11 tonnes and 4 tonnes of gold respectively.
Looking ahead, the WGC said that “further sales from central banks should not be discounted, especially from those that buy from domestic sources” like Kazakhstan and Uzbekistan.
It noted, too, that Russia announced plans to purchase foreign currency and gold early last month.
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