The world Central banks are buying record amounts of gold

Центробанки мира рекордными объемами скупают золото

Global gold demand in the first half of 2019 jumped to a three-year high amid increased purchases by Central banks and inflows into gold-backed exchange traded funds (ETFs).

As estimated by World Gold Council (WGC), in comparison with the first half of 2018, the demand for gold increased by 8%, to 2,182 thousand tons, including 1,123 thousand tonnes in the second quarter.

Central banks purchased more than half of the 374 tons of gold, the biggest net increase in world gold reserves in the first half for the entire 19-year history of the WGC observations.

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Most gold, 100 tons during the second quarter, bought Poland (it is not the biggest quarterly purchase of one of the Central Bank, since India bought 200 tonnes of gold from IMF in November 2009).

Russia has moved into second place in the first six months of the purchase amounted to 94 tons.

Also the gold in the first half purchased China (74 tons), Turkey (61 tons), Kazakhstan (25 tons), India (about 18 tons), Ecuador (nearly 11 tons), Colombia (6 tons) and Kyrgyzstan (2 tons).

Assets of ETFs YTD increased by 107.5 per ton, reaching a six-year high of 2,548 thousand tons.

The main factors stimulating the inflow in the sector were continuing geopolitical instability, and dovish comments from Central banks in relation to monetary policy and rising prices for gold in June.

“We believe that the factors underlying the ETF inflows and purchases by Central banks, including monetary policy easing and geopolitical uncertainty will continue in the second half. However, consumer demand may weaken in the process of adaptation to a higher level of prices”, – says head of market intelligence Alistair Hewitt, WGC.

Gold prices rose to a six-year high

Earlier it was reported that the European Central Bank (ECB) and Central banks of the Eurozone countries, Sweden and Switzerland, signed in 2014, the fourth Central Bank agreement on gold (Central Bank Gold Agreement, CBGA), no longer see it as necessary.