Latest news with #CentralBankGoldReservesSurvey2025
Time of India
01-08-2025
- Business
- Time of India
Central banks are building a haven of bullion assets
MUMBAI: Central bank gold appetite, although not as voracious as the 1,000-tonne-a-year purchases in the past three calendar years, remains largely undiminished globally as this group of institutional buyers diversifies its asset base beyond the customary dollar-denominated holdings in a world increasingly strewn with tariff snags. Central banks net bought 166 tonnes of gold in three months to June, 33% lower quarter-on-quarter, World Gold Council (WGC) data showed. While this is the lowest quarterly number since June 2022, it is 41% higher than the average quarterly level seen between 2010 and 2021, before buying ramped up sharply in more recent years, WGC data showed. Explore courses from Top Institutes in Please select course: Select a Course Category For the first half (H1) of 2025, the number stood at 415 tonnes compared to 525 tonnes in year ago. This is also the lowest first half since 2022. Elevated gold prices amid destabilising economic and geopolitical environment has likely contributed to the slowdown in central bank buying, WGC said. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Puerto Plata: Bathroom Remodeling Trends in 2025 May Surprise You Bathroom Remodeling | Search Ads Search Now Undo According to Madhavankutty G , chief economist at Canara Bank, the central banks' gold purchases fit perfectly into the de-dollarisation theme, where countries want to diversify their foreign exchange reserves. Though the dollar is still dominant in FX reserves, its share is coming down drastically, with gold benefiting from this shift. "The added benefit of gold is also the safety aspect. The US tariffs have increased the geopolitical as well as global economic uncertainty, which in turn is expected to keep gold prices elevated. Historically, US Treasury yields and gold prices were inversely related. That relationship has broken now. So even as yields are expected to remain above 4.30%, gold demand prices may also remain high," he said. Live Events Although central banks typically are strategic buyers of gold, they are not completely insensitive to its price level. "But that they continue to add gold in the face of a higher price underscores their continuing favourable attitudes towards gold as a strategic asset amid such uncertainty," it said. According to WCG, the longer-term trend of central banks taking advantage of gold's diversification properties and reallocating from US assets to gold remains intact. The Reserve Bank of India (RBI) bought nearly half a tonne of gold in the last week of June after a relatively conservative spell of bullion shopping in the current fiscal year, ET reported earlier. The RBI 's outstanding stock of gold amounted to nearly 880 tonnes as of June 27. Its share in India's foreign exchange reserves climbed to 12.1% as of July 18, 2025, from 8.9% as of July 19, 2024. WGC's Central Bank Gold Reserves Survey 2025 revealed that 95% expect gold reserves to increase over the next 12 months. The results of the survey, which collected data from 73 of the world's central banks, were published in mid-June. The National Bank of Poland was the largest buyer of gold, adding 19 tonnes to its gold reserves in the June quarter, while China's reported purchases amounted to 6 tonnes, half of what it bought in the March quarter. China's gold reserves now stand at 2,299 tonnes, WCG data showed.
Yahoo
17-06-2025
- Business
- Yahoo
Central banks expect to swap out more of their U.S. dollar reserves for gold as greenback's safe-haven status weakens
Central banks from the Global South are actively shifting their own reserves toward gold at a much faster rate than advanced economies to reduce their exposure to the U.S. dollar amid growing trade protectionism, according to a survey by the World Gold Council. 'The recent market developments around tariffs have raised questions on the safe-haven status of USD/UST, but have bolstered that of gold,' one response read. Roughly every second central bank in the Global South plans to expand its own gold reserves over the coming 12 months, new data shows, and the currency most likely to pay the price for the shift is the U.S. dollar. Results from the Central Bank Gold Reserves Survey 2025 published on Tuesday by the World Gold Council (WGC) found geopolitical instability and potential trade conflicts as chief reasons why emerging economies are shifting toward gold at a much faster rate than advanced economies. Asked more broadly about their expectations regarding how their international peers will behave in the coming 12 months, there was near unanimity regardless of the country of origin. Of the 15 central banks from advanced economies and 58 central banks from emerging markets and dynamic economies, or EMDE, polled, 95% expected overall gold reserves to increase in the next 12 months. This helps explain why the precious metal—despite its lack of a yield versus other assets as well its physical storage costs—touched $3,446 an ounce, close to its April record, while the U.S. dollar index is near three-year lows. 'The uncertainty stemming from the tariffs implemented and committed by the USA regarding trade policies in the recent period may reduce the interest in USD and USD-denominated assets as a reserve currency,' one anonymous central bank is quoted as saying in the report. Of all institutions polled, 48% of those in the Global South expected their own gold reserves to grow in the immediate future versus just 21% in advanced economies. Respondents argued the de-dollarization trend that favors a shift to gold would continue owing to increased tariffs and trade protectionism, but any decline would likely be gradual as a result of the U.S.'s deep financial markets, comparatively strong legal institutions, and the lack of any obvious substitute. In 2024, central banks bought 1,045 metric tons of gold, accounting for about a fifth of global demand. This marked the third straight year during which they accumulated over 1,000 tons, according to figures from the WGC, up sharply from the 400- to 500-ton average over the preceding decade. According to the survey, 72% of all respondents believe gold reserves held by the world's central banks will increase moderately over the next five years versus 66% the previous year. Another 4% of respondents, coming entirely from non-advanced economies, predict the gain will be even be significant, up 1 percentage point from before. 'Central banks are expected to continue purchasing gold as they look for ways to reduce dependence on USD,' one central bank replied in the survey. 'The recent market developments around tariffs have raised questions on the safe-haven status of USD/UST, but have bolstered that of gold.' By comparison, 45% expect a moderate drop in U.S. dollar holdings over the same time period. While this represents an improvement over the 49% a year earlier, the number replying dollars would see a significant decline soared—to 28% from 13% previously. The sharpest divergencies in responses between advanced economies and the Global South related to the trend of de-dollarization and how great a role geopolitical tensions play in fueling it. When asked how much of total global reserves would still be denominated in dollars five years from now, more central banks from non advanced economies anticipated a slight decrease from the current 43% share than their peers in advanced economies. For comparison, gold accounted for only 19% of total reserves, with 15% allocated in euros and 2% in Chinese renminbi. Among those that expected no change in the share of dollar-denominated reserves, the relationship was flipped: far more advanced economies believed this to be the case than those elsewhere. 'This resonates with the recent trend in reported central bank holdings, where we see a stronger appetite for gold accumulation from [emerging markets and dynamic economies] central banks,' the World Gold Council concluded. This story was originally featured on Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
