Central banks continued their determined accumulation of gold in November 2024, purchasing a net 53 tonnes (t) of the precious metal according to reported data. This steady acquisition extends a year-long pattern of robust official sector demand for gold, driven by economic uncertainties and the quest for reserve stability.

The National Bank of Poland (NBP) once again led the month’s purchases, adding 21t of gold to its reserves, pushing total holdings to 448t. Gold now represents nearly 18% of Poland’s total reserves, moving closer to the central bank’s previously stated goal of 20%. Poland’s consistent activity has firmly positioned the country as the top central bank gold buyer of the year, with 90t accumulated year-to-date (YTD).

Asia’s central banks continued their buying strategies as well. The Reserve Bank of India (RBI) further reinforced its 2024 buying streak by adding another 8t in November, bringing its YTD purchases to 73t and total gold reserves to 876t. This makes India the second-largest central bank buyer of the year, closely following Poland. Meanwhile, the Central Bank of Uzbekistan resumed purchases after a pause since July, acquiring 9t during the month, raising its total gold holdings to 382t.

Poland and Emerging Economies Drive Gold Purchases

A key development in November was China’s re-entry into the gold market. After a six-month hiatus, the People’s Bank of China (PBoC) added 5t to its reserves, increasing its YTD net purchases to 34t and total gold holdings to 2,264t, representing approximately 5% of the country’s total reserves. The PBoC’s return signals a renewed interest in strengthening its reserves despite broader economic pressures.

Kazakhstan mirrored this trend, adding 5t to its gold holdings in November for the second consecutive month. The National Bank of Kazakhstan has now flipped to being a net buyer, with a modest YTD net purchase of 1t, and total gold holdings of 295t.

In Jordan, the Central Bank added over 4t of gold to its reserves, the first increase since July, lifting total holdings to 73t. Similarly, the Central Bank of Turkey added 3t in November, while also engaging in reverse swap agreements with domestic banks, exchanging gold for lira to manage liquidity more effectively.

Strategic Gold Acquisitions Continue

The Czech National Bank extended its buying streak to a 21st consecutive month with the addition of almost 2t in November. This brought its total YTD gold purchases to nearly 20t and total holdings to just above 50t.

However, not all central banks were net purchasers. The Monetary Authority of Singapore emerged as the month’s largest seller, reducing its gold reserves by 5t, resulting in YTD net sales of 7t and overall holdings at 223t.

The Bank of Finland also made headlines by reducing its gold reserves by 10% in December, marking its lowest holdings since December 1984. The sale, equating to approximately 5t, was part of a strategy to mitigate foreign exchange risk, with the central bank citing heightened currency volatility as a primary concern.

Divergent Approaches in European Gold Reserves

While the motivations for these moves vary, a shared theme emerges: central banks continue to view gold as a safe haven and strategic reserve asset in the face of global economic fluctuations. Poland’s strategic acquisitions, India’s sustained buying streak, and China’s cautious return underscore the broader trend of reinforcing national reserves with gold despite market volatility.

The price dip following the US elections in November may have encouraged some of this buying activity, with central banks capitalising on a temporary softening in gold prices to strengthen their portfolios.

Sustained Gold Demand Likely

With just December data yet to be finalised, 2024 appears set to mark the 15th consecutive year of net central bank gold purchases. The consistent buying by emerging economies, particularly in Asia and Eastern Europe, reflects a clear preference for gold as a hedge against geopolitical and financial market risks.

The World Gold Council’s next Gold Demand Trends report, scheduled for release in February 2025, will offer a complete review of central bank gold demand for the year. Yet, the sustained buying patterns throughout 2024 have already reinforced gold’s standing as a cornerstone of global financial stability and wealth preservation.