Central Banks' Gold Buying Drives Record Highs, While Uzbekistan Emerges as a Major Seller
Central banks worldwide have been buying gold , leading to record-high prices. Consumers and retail investors, particularly in China, are also buying gold as a store of value amid economic and geopolitical uncertainties. In 2022, global gold demand reached nearly 4,700 tons, outstripping mined production. But now some banks are looking for encash like Uzbekistan's Central Bank was the biggest net seller of gold in Q1 2022, disposing of 10.9 tons. The country's gold stash accounted for nearly three-quarters of its reserves as of March 2022. The gold rush is creating jobs and increasing gold production by 50% by 2030.
Highlights
# Central banks have been significant players in the gold market, with their buying activities contributing to the surge in gold prices.
# The increased demand for gold by consumers and retail investors, especially in China, is attributed to its reputation as a reliable store of value during times of economic and geopolitical uncertainty.
# The record-high spot gold price of approximately $2,440 per ounce reflects a 17% increase this year, influenced by political events in the Middle East.
# Global gold demand exceeded mined production in 2022, with nearly 4,700 tons demanded versus 3,628 tons produced.
# The Central Bank of Uzbekistan emerged as a notable net seller of gold, capitalizing on the high market prices by selling significant quantities in recent months.
# Thailand's central bank also participated in the selling trend, offloading 9.6 tons of gold in March.
# These sales are part of a broader strategy by some central banks, including Uzbekistan's, to rebalance their reserves by reducing their gold holdings, a shift from their previous gold accumulation during the pandemic.
Source: https://in.investing.com/