↑ CB Purchases rises → Gold rises ↑Source: Industry research reports·Annually (industry demand report, ~Feb each year)
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What is the CB Purchases?
Central banks (like China's PBOC, India's RBI, Poland's NBP, or Turkey's CBRT) buy gold to hold in their foreign reserves — the savings account of a country.
When a central bank buys gold, it usually means: they want to reduce dependence on the US dollar, they're worried about geopolitical risks, or they want a store of value that can't be frozen or sanctioned.
The 2022–2023 purchases of 1,000+ tonnes per year were the highest since the end of the gold standard.
How does it affect gold?
↑ Rule: When CB Purchases rises → gold tends to rise
Central bank buying is the single most important structural driver of gold in the 2020s. When central banks buy in bulk, they create sustained, price-insensitive demand that supports the gold price regardless of what interest rates or the dollar are doing.
Think of it this way: a central bank buying 100 tonnes of gold doesn't care if gold went up 10% last month. They're buying for decades, not weeks.
Record central bank purchases in 2022–2023 are a primary reason why gold hit all-time highs despite high interest rates — a historically unusual combination.