Before 2022, central banks had never bought more than 650 metric tons of gold in any single year but that changed in 2022. Central banks responded to the start of the war in Ukraine in February 2022 and soaring inflation, combined with weaker currency values around the world, to add a record-high 1,082 metric tons to their coffers, a huge 66% increase over the previous record.
In 2023, central banks did not quite break that record high but they added a second straight 1,000+ ton year with 1,029 metric tons of gold buying, according to World Gold Council data. Central banks now hold an estimated 36,700 tons or 1.18 billion Troy ounces of gold, worth $2.57 trillion.
Central banks have been net buyers of gold every year since 2010, with the amount growing over the past four tumultuous post-COVID years. The World Gold Council reports the majority of purchases during the fourth quarter of 2023 came from emerging markets, as they diversify from the U.S. dollar. The People’s Bank of China was the largest buyer in the fourth quarter, adding 225 tons. Poland was the second largest, buying 130 tons, followed by Singapore at 77 tons, the sole “developed” or rich nation-buyer, with those buyers offset by gold sales by some other nations.
The World Gold Council also reported that outflows from gold ETFs continued in February, for the ninth consecutive month of net ETF outflows. But, they stated, “Nonetheless, the two recent rounds of sustained outflows had little negative impact on the gold price performance, which was supported by resilient consumer demand and central bank purchases.” They said U.S. ETFs lost the most in outflows. “In contrast, Asia has now seen net inflows for 12 consecutive months,” the report states.
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Mike Fuljenz, president of Universal Coin and Bullion, taught classes on grading and counterfeit coin detection for over 20 years. He has also assisted the Texas Attorney General with drafting consumer alerts on coins and on counterfeits. He has lectured and conducted training for law enforcement with the Numismatic Crime Information Center. He has been a member of the National Anti-Counterfeiting Task Force, as well as assisting the Federal Trade Commission with their consumer alerts on coins.