Are we seeing a new gold rush? Discover the reasons fueling the recent central bank gold buying spree.

Central Banks Buying Gold: What's Behind the Latest Surge?

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In 2022, central bank demand for gold hit an 

Central banks around the world added a staggering 

 of the precious metal to their stockpiles - worth a whopping 

largest increase in gold reserves in over 70 years

Which countries were the biggest gold buyers in 2022? 

Let´s take a look at the latest findings by the World Gold Council (WGC).

a safe full of gold bars on the map of Turkey

Turkey's Central Bank bought the most gold in 2022, pushing its official reserves to as many as 

 in Turkey has reached unprecedented levels over the past few years, topping 

So, quite obviously, buying so much gold was a move to protect the country’s fragile economy, which just confirms gold's historic role as 

China 🇨🇳 bought a lot of gold last year, too.

 for the first time since 2019 by adding 62 tonnes in November and December and bringing its total gold stockpile to over 

“These announcements were significant given China’s historic position as a large buyer of gold, having accumulated 1,448 tonnes between 2002 and 2019,”

One of the possible reasons why China increased its gold purchases is to 

The relations between Beijing and Washington have become fragile lately, following a number of restrictions on Chinese semiconductor companies and 

Additionally, Chinese central bank reserves are mostly made of U.S. dollars, which could be 

 at any time, as the U.S. did with Russian reserves after Moscow’s invasion of Ukraine.

 quickly, with gold being a reliable and safe option.

So, to sum up, in 2022, the biggest gold buyers - Turkey and China - stocked up on the shiny metal for two key reasons: 

to protect themselves against high inflation

But there are some other explanations why central banks keep buying physical gold. 

The WGC asked central banks why they bought gold in 2022, and this is what they said:

A table showing the results of a World Gold Council survey of central banks on reasons they keep buying physical gold.

, were among the most important things for central banks in their gold buying spree. But what does this mean, exactly?

Let’s look at each one of them in more detail: 

physical gold has always played an important role in the world economy. Gold was the basis of almost all major currencies until 1971, when the U.S. unilaterally ditched the gold standard.

 unlike bonds and national currencies, gold does not rely on any issuer or government. So when you buy physical gold, 

don't have to worry about someone else taking it away from you

unlike your national currency, which can lose value over time due to inflation or changes in the economy, gold is a physical asset that is not subject to the same types of fluctuations. While the price of gold can go up and down in the short term, over the long term, it has proven to be a reliable store of value.

 gold is a safe-haven investment that retains its value (or even goes up in value) during stock market crashes or geopolitical uncertainty.

So, looking ahead, it seems likely that central banks will keep buying gold in 2023, but it's hard to say, of course, what will happen exactly.

In any case, this fresh data shows that central banks have changed their minds about gold since the 1990s and 2000s. Back then, many central banks sold a lot of their gold each year, but now they are buying more instead.

Not to sound like a doomsday prophet, but 

do central banks know something we don’t?

stacks of gold coins and bars with a rising golden arrow on a golden background

Essentially, one thing: you can take example from central banks and start building your 

Just like central banks buy gold to protect their economies from inflation and economic uncertainty, you can 

use your gold savings to protect your personal finances

 that is not affected by inflation, which means that the value of your 

, during times of economic uncertainty, you may lose confidence in the stock market or traditional forms of currency. During such times, gold often becomes more valuable as investors buy it as a 

 that you can hold in your possession. Unlike digital assets or stocks, it cannot be lost or stolen electronically. So, as we’ve said before, knowing that you have a physical asset that 

Gold offers several powerful advantages as a store of value. Discover why more and more investors are turning to this precious metal.

What are the advantages of gold compared to other investments?

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A Shift in Gold Demand Trends

Good thing central banks can't print gold. 😉

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