Central banks switch from sellers to buyers, reversing decades-old trend
The continued surge in the gold price amid financial market turmoil is seeing a dramatic shift in the pattern of gold buying and selling at the world's central banks.
The Globe and Mail reports that after two decades of being net sellers of gold, central banks are now buying gold at a record pace reflecting deep concerns about the viability of the US dollar and the euro as stores of value:
Official net purchases of gold exploded in the third quarter, totalling 148.8 tonnes, more than double the entire amount of government buying in 2010, the World Gold Council, a London-based industry association, said in a new report Thursday.
“We are seeing what now looks like unprecedented levels of central bank buying,” said Marcus Grubb, managing director, investment, at the Gold Council. “We do believe this is a long-term trend. This is not just short-term, tactical buying.”