Report: Central banks exploit falling gold prices to boost reserves

Central banks took advantage of the decline in gold prices to increase their reserves, according to a report by the World Gold Council, which noted that investment funds recorded inflows of 211 tons, despite rising bond yields and a strong dollar.

Central banks took advantage of the decline in gold prices to increase their reserves, according to the World Gold Council's third-quarter 'Global Gold Trends' report. Exchange-traded funds recorded inflows of 211 tons, supported by financial concerns, despite rising bond yields, a strong dollar, and easing geopolitical tensions. Global gold demand fell by 1% in the third quarter compared to the same period last year, to 1,369 tons. Jewelry demand also fell by 17% to 313 tons, marking the weakest third-quarter performance since 2000. Gold purchases for investment purposes declined by 19% to 268 tons. The price of an ounce of gold fell by 29% from its all-time high of $5,595 in January to around $3,900, driven by Middle East developments that pushed oil prices higher and expectations that interest rates would remain high. Central banks exploited this price correction to return strongly to the market and increase their reserves, with their gold purchases in the third quarter rising by 42% year-on-year to 321.2 tons, exceeding the five-year quarterly average of 227 tons. The People's Bank of China leads the list of buyers.