World Gold Council: Gold Price Correction Presents Buying Opportunity as Central Banks Step Up Purchases

　　In October, multiple central banks published their gold purchase data, and major Asian countries' reserves are nearing the size of France's

　　Krishan Gopaul, Senior Analyst for Europe, Middle East, and Africa at the World Gold Council, disclosed gold purchase details for central banks in October via social media. He stated that a major Asian country bought 26 tons of gold in October, raising its official gold reserves to 2,435 tons—just 2 tons shy of France’s gold reserves—meaning its reserves are now on par with those of major developed countries.

　　Apart from Asian countries, many emerging market central banks also maintained their buying momentum. The Czech National Bank bought 2.5 tons of gold in October, bringing its total reserves to 90 tons, just a 10-ton gap from its 100-ton reserve target. Uzbekistan’s central bank bought 7 tons of gold in October, with net purchases for the year reaching 63 tons, expanding its total gold reserves to 453 tons. The National Bank of Poland also completed a purchase of 27 tons of gold in October, officially achieving its goal of 700 tons in reserves.

　　Poland achieves interim target, central bank governor signals continued purchases

　　Poland has completed its previously set gold reserve target of 700 tons, but the governor of the National Bank of Poland, Adam Glapinski, has not ruled out the possibility of continuing to increase reserves. He said, “After achieving the 700-ton goal, we will calmly assess the future direction, but I see no reason to stop purchasing gold. In my view, the scale of gold reserves should grow in line with the country’s overall foreign exchange reserves.” This suggests that even after reaching the prior target, Poland may still have potential demand to further expand its gold reserves.

　　Third-quarter gold purchases up 40% year-on-year, central banks’ dual impact on gold prices

　　The concentrated gold buying in October continued the purchasing frenzy seen throughout the summer. A previous report from the World Gold Council showed that central banks globally bought a total of 321 tons of gold in the third quarter, up 42% year-on-year and significantly higher than the five-year quarterly average of 227 tons. Second-quarter gold purchases were also revised slightly upward, confirming the robust momentum of official gold buying.

　　Council analysts indicated that central bank gold purchases in the third quarter exceeded market expectations, and research results reflected the strategic allocation intentions of national central banks. Demand for gold purchases is expected to remain strong in the fourth quarter. The report also noted that central bank buying is sensitive to gold prices—purchases are more likely during price corrections—which can provide support and help smooth market fluctuations. However, this link is not stable, and central bank gold buying should not be seen as an unbreakable floor for gold prices.

　　Conclusion

　　Against a backdrop of high interest rates suppressing gold prices, central banks worldwide have continued allocating gold during price corrections, with major Asian countries, Poland, and Uzbekistan continuing to increase their holdings, and some nations leaving room to add more after achieving interim targets. Central bank buying is an important source of long-term support for gold, but short-term gold price movements will still be more influenced by Federal Reserve monetary policy and the strength of the US dollar and should not be judged solely on the basis of central bank purchases.

Editor: Zhu Henan