Original title: global central banks resume net purchases of gold, which is expected to continue to increase the sources of gold reserves: central banks, Intercontinental Exchange Inc benchmark managers, International Monetary Fund, World Gold Council

China's foreign exchange reserves were $3.17849 trillion in November, an increase of $50.508 billion, or about 1.6 per cent, from October, according to data released by the State Administration of Foreign Exchange in December 2020. At the end of November, the central bank's gold reserves were 62.64 million ounces, or 1948.3 tons, the same as at the end of October.

In addition, according to data released by the World Gold Council in December,As of October 2020, global official gold reserves totaled 35171.3 tons.Of this total, the euro zone (including the European Central Bank) totaled 10772.1 tons, accounting for 61.0% of its total foreign exchange reserves.

Global official Gold reserves, International Financial Statistics, December 2020

Source: central banks, Intercontinental Exchange Inc benchmark management, International Monetary Fund, World Gold Council

The official gold reserve data of the top 15 in the world show thatAs of October 2020, Russia reduced its gold holdings by 0.1 tons, India increased its gold holdings by 1.9 tons, Turkey increased its gold holdings by 6.9 tons, and the other top 15 central bank official gold reserves remained unchanged.

As the data show, after two consecutive months of net gold sales, global central banks returned to net purchases in October, with a net increase in global official gold reserves of 22.8 tonnes.The level of gold purchases was the same as that of the previous two months, but the amount of gold sold was greatly reduced. Central banks around the world reported net gold sales in the third quarter of 2020 for the first time since the fourth quarter of 2010, mainly due to heavy gold sales in Uzbekistan and Turkey. It has also triggered a new round of attention to central bank gold demand and wonder whether it heralds a shift in the concept of gold reserves.

This year, the price of gold (year to date)Growth of 18.6%) still maintains its advantage over many other traditional reserve assets, continuing to provide the central bank with the additional firepower needed to stabilize markets and currencies in an unprecedented uncertain environment.

The central bank's net purchases so far from the beginning of the year have been between 200 and 300 tons. By 2020, buyers had outnumbered sellers (9 to 8), with several central banks accounting for a relatively low proportion of total reserves, but also increased gold purchases, demonstrating their continued willingness to increase their gold reserves and maintain them at strategic levels.

We expect that some gold selling is not surprising given the role of gold as a safe, liquid reserve asset, but the continued deposit trend of the central bank still highlights the importance of gold to the central bank portfolio. In the future, central banks around the world may continue to maintain a state of net purchases.

This article is from the World Gold Council