Column: Electric dreams turn into a nightmare for battery metals
A sector that was once racing to build new supply has been closing mines and deferring projects as low prices bite into the cost curve.
China’s central bank added 160,000 troy ounces of gold to its reserves in March, it said, in line with the market view that persistent official sector demand had supported gold’s recent rally.
Spot gold jumped 9.3% in March, its strongest monthly performance since July 2020, despite a strong dollar and elevated US real interest rates. That rally has continued, with gold hitting successive record highs during the last seven sessions to touch $2,353.79 per ounce on Monday.
“China has now been adding gold to its reserves for 17 consecutive months. It supports our view that central banks remain firm believers in gold and continue to see value in it,” Krishan Gopaul, senior EMEA analyst at the World Gold Council (WGC), told Reuters.
China held 72.74 million ounces of gold at the end of March, up from 72.58 million ounces a month before, official data showed on Sunday. The value of China’s gold reserves rose to $161.07 billion from $148.64 billion.
Demand from global central banks for gold has been elevated for two years, and they are on track to remain active buyers in 2024, Gopaul said. Turkey, India, Kazakhstan, and some eastern European countries have been buying gold this year along with China.
The People’s Bank of China (PBOC) was the largest official sector buyer of gold in 2023 with net purchases of 7.23 million ounces, or 224.9 metric tonnes. It was the country’s highest single year of reported additions since at least 1977, according to the WGC.
In total, global central banks bought 1,037.4 tonnes of gold in 2023, down 4% from 2022’s record levels. They could reduce net purchases by a further 200 tonnes in 2024, the WGC said in January.
(By Polina Devitt; Editing by Jan Harvey)
Read More: China’s latest investment frenzy sparks wild swings in gold ETF
Comments