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Gold Holds Near $4,800 as Central Banks Hit 23 Months of Buying
Central banks have now bought gold for 23 consecutive months - a streak that underpins the metal’s resilience even after a sharp pullback from its recent highs above $5,200.
What to know
- Central bank gold purchases have now extended to 23 consecutive months, providing a structural demand floor beneath the market.
- Gold is trading at $4,793/oz - steady on the day but down nearly 6% from its monthly high above $5,229.
- Key US macro data including Core PCE and GDP are due today, with potential to drive the next directional move.
What happened
Central banks globally have now accumulated gold for 23 straight months - nearly two full years of unbroken net purchases. The streak represents one of the longest sustained periods of official sector buying on record.
Gold is trading at $4,793.20/oz, essentially flat on the session but sitting within a weekly gain of nearly 3%. The metal has pulled back almost 6% from its monthly peak of $5,229.70, yet remains well above the $4,100 floor tested earlier in the period. That range - over $1,100 top to bottom - reflects a market caught between competing forces.
World Gold Council figures have consistently highlighted the official sector as the dominant marginal buyer in recent quarters. This is not opportunistic accumulation but a deliberate, sustained shift in how sovereign wealth is allocated.
Who’s involved
The buying coalition spans multiple regions, though the heaviest activity continues to come from emerging market central banks seeking to reduce dollar exposure. China’s People’s Bank of China, the Reserve Bank of India, and several Middle Eastern and Central Asian monetary authorities have been the most visible accumulators over the past two years.
Western central banks have largely stood pat - neither buying nor selling in meaningful volumes. The divergence is telling. Emerging economies are actively restructuring reserves, while developed market institutions appear content with existing allocations.
On the private side, the demand picture is equally supportive. Anyone buying gold at current levels is doing so alongside the most powerful institutional buyers on the planet. Retail and ETF flows have followed the central bank lead, though with more sensitivity to price swings - the pullback from $5,229 likely shook out some shorter-term holders.
Why it matters
A 23-month buying streak is not noise. It represents a fundamental recalibration of how nations think about reserve assets. The last comparable period of sustained central bank accumulation ran from 2010 to 2013, and gold tripled during that cycle before eventually correcting.
The current streak carries additional weight because it is occurring against a backdrop of geopolitical fragmentation and active de-dollarisation efforts. Gold’s role as a neutral reserve asset - one that carries no counterparty risk and sits outside any single nation’s control - has never been more relevant.
From a supply-demand perspective, central bank purchases of this magnitude effectively remove hundreds of tonnes annually from the available market. Mine supply grows at roughly 1-2% per year. When the largest buyers in the world are absorbing supply at this pace, the floor beneath prices becomes structurally higher with each passing quarter.
The gold-silver ratio at 63.6 suggests silver is keeping pace for now, with silver up 3.7% on the week versus gold’s 2.9%. But central bank demand is overwhelmingly a gold story - silver does not feature meaningfully in sovereign reserve strategies.
What to watch
Today’s US data releases deserve close attention. Core PCE and GDP figures landing later in the session will shape near-term Fed expectations and, by extension, the dollar. A softer GDP print or cooling inflation could reignite the push toward $5,000. Hotter numbers may extend the pullback from recent highs.
Beyond the macro calendar, the next World Gold Council quarterly demand report will be critical for quantifying exactly how much metal central banks absorbed in Q1 2026. Any acceleration from the 2025 pace - which already ran well above 1,000 tonnes annualised - would be a significant bullish signal.
$4,700 is the near-term support level. A hold above that zone, combined with continued official sector buying, keeps the path toward retesting $5,200 intact. A break below opens the door to the $4,400-$4,500 region where buyers stepped in earlier this month.
This article is for informational purposes only and does not constitute financial advice. Always do your own research before making investment decisions.
