Gold is on a historic upswing, shattering records as central banks stockpile unprecedented amounts. It recently soared to an all-time high of $2,865 per ounce, marking a 30% gain over the past year. In 2024 alone, bullion prices broke 40 records, fueled largely by central banks seeking refuge from financial instability. As a time-tested safe haven, gold remains a stable asset untethered from government-backed currencies.1
In 2024, central banks made their presence felt. For the third year in a row, they bought over 1,000 tons of gold, totaling more than $96 billion. These purchases accounted for about 20% of global demand. The biggest buyers? Poland, India, Turkey, and China.2
The fourth quarter saw a major uptick in gold buying. Central bank purchases soared 53.5% from the same period in 2023. According to the World Gold Council (WGC), “Central banks continued to vacuum up gold at an eye-watering pace, their buying exceeded 1,000t for the third year in a row, accelerating sharply in the fourth quarter to 332.9t.”3
This steady buying trend tells us central banks aren’t just responding to short-term price changes; they’re making strategic long-term investments. They hardly ever sell gold, showing just how committed they are to it as a reserve asset. In fact, central banks have been net buyers for 15 years straight.
In 2024, global gold demand hit a record 4,974 tons, the WGC reports. “In 2024, global gold demand surged to a new quarterly high and a record annual total bolstered by heightened geopolitical and economic uncertainties,” said Shaokai Fan, global head of central banks at the World Gold Council.4
So, why are central banks scooping up gold? There are three main reasons:
Inflation Concerns: With inflation lingering globally, gold is seen as a hedge against currency devaluation.
Geopolitical Tensions: Ongoing global conflicts and political instability are pushing central banks to secure their assets in gold—viewed as a safe-haven investment.
Diversification: With large amounts of vulnerable fiat currency tied up in reserves, central banks are looking to diversify and minimize risk.
This surge helped push gold’s total market value for 2024 to an all-time high of $382 billion. Investment demand for gold jumped, too, reaching a four-year high with a 25% increase from 2023.5
The WGC predicts central banks will once again purchase over 1,000 tons of gold in 2025. As one strategist put it, “When we look at central bank demand, their rationalization for owning gold remains very strong. The growing government debt burdens and the dramatically changing geopolitical landscape suggest that central banks will continue to buy gold.”6
A key part of this shift? Central banks moving away from the U.S. dollar. The share of gold in foreign exchange reserves has climbed to 34%, as concerns grow over Western sanctions—especially in Russia and China. This fits with the broader trend of de-dollarization within the BRICS nations—Brazil, Russia, India, China, and South Africa—who are reducing their reliance on the U.S. dollar for international trade and transactions. This shift to gold could further undermine the U.S. dollar’s role as the global reserve currency.
Maurizio Mazziero, a financial analyst, commented, “In the background, there is always the BRICS project to initiate a new currency pegged to gold to be used in trade instead of the US dollar. The fact that Trump has announced 100% tariffs for those who will adopt it highlights its real feasibility and the accompanying fears.”7
Emerging markets were major buyers in 2024, with Poland, Turkey, India, and China making significant purchases. Poland led the way, adding 90 tons to its reserves, followed by India’s RBI with a 73-ton increase. Turkey and China each added 75 tons and 44 tons, respectively.
But official reports don’t always tell the full story. Some central banks, like China, are believed to have continued buying gold secretly, despite pausing official purchases. Analysts suspect China could be adding up to 10 times more gold than publicly reported.
Looking ahead, analysts expect even higher gold prices in 2025. Swiss bank UBP forecasts gold could hit $3,000 per ounce, while JP Morgan thinks prices will push beyond that. Some even predict the rally could take gold as high as $3,200 an ounce.8
Central banks aren’t just buying gold—they’re also driving broader market trends with monetary policy. The U.S. Federal Reserve, for example, is expected to continue cutting interest rates, with many predicting a 100 basis point cut in 2025. This dovish monetary policy could support gold prices, especially if inflation continues to hover above target levels.
Implications for the Gold Market
The ongoing surge in central bank gold purchases has several implications for the market:
Price Increases: As demand continues to rise, gold prices are expected to climb, benefiting investors and miners.
Market Confidence: Central bank actions bolster confidence in the gold market, drawing in more investors.
Long-Term Trends: The sustained interest in gold points to its continued importance in central bank strategies going forward.
Conclusion
With central banks driving record-breaking gold demand and prices expected to rise even further, now is the time to explore how gold can protect your wealth. A Gold IRA can help you take advantage of gold’s stability and long-term growth potential. You can learn how to safeguard your financial future with a Gold IRA by contacting American Hartford Gold today.
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Max Baecker is the President of American Hartford Gold (AHG), the nation’s largest retailer of precious metals. He leads American Hartford Gold’s mission to help clients achieve long-term financial security with physical gold and silver.
Under his guidance, American Hartford Gold has delivered billions of dollars’ worth of precious metals to thousands of satisfied clients.
Max's dedication to upholding American Hartford Gold's industry-leading standards is reflected in its accolades. American Hartford Gold has made numerous high-ranking appearances on the prestigious Inc. 5000 List of America’s Fastest-Growing Private Companies. AHG holds an A+ Rating from the BBB and a 5-Star Rating on Trustpilot from thousands of American Hartford Gold reviews. American Hartford Gold is the only precious metals company trusted and recommended by Bill O’Reilly.
AHG offers investment-grade gold and silver coins and bars at competitive prices. Clients also benefit from its buy-back commitment with no back-end fees. To learn more, visit American Hartford Gold.
Notes:
1. https://www.forbes.com/sites/timtreadgold/2025/02/05/gold-hits-an-all-time-record-2865oz-thanks-to-central-bank-buying/
2. https://finance.yahoo.com/news/gold-appeal-central-banks-seen-060000891.html
3. https://www.forbes.com/sites/timtreadgold/2025/02/05/gold-hits-an-all-time-record-2865oz-thanks-to-central-bank-buying/
4. https://www.cnbc.com/2025/02/05/worlds-demand-for-gold-hit-another-record-high-in-2024.html
5. https://www.kitco.com/news/article/2025-02-05/central-banks-buy-more-1000-tonnes-gold-2024-third-year-row-world-gold
6. https://www.kitco.com/news/article/2025-02-05/central-banks-buy-more-1000-tonnes-gold-2024-third-year-row-world-gold
7. https://www.morningstar.com/funds/gold-just-hit-new-record-whats-next
8. https://www.economies.com/commodities/gold-analysis/gold-breaks-$2,800:-time-to-act-now-before-2025-launches-it-past-$3,000%20-115774