China added about 15 tonnes of gold to foreign exchange reserves in September, as global central banks accelerated their precious metals purchases after a seasonally quiet period in the summer, according to Goldman Sachs.
This estimate is much higher than the 1.24 tons that China officially reported in the month. Goldman's analysis team, including Lina Thomas, said central banks around the world bought a total of 64 tonnes of gold in September, more than three times more than the previous month. According to Goldman, this buying wave is likely to continue in November.
Central bank gold purchases have become a key driver for the precious metal's strong rally over the past three years, taking gold prices to a record high of more than $4,380 an ounce in October before a slight correction in recent weeks. However, despite playing an important role, gold purchases by countries always cover a "mysterious" layer because many countries often report in reality.
We continue to see the trend of central banks accumulating high levels of gold as a trend that has lasted for many years, as they diversify their reserves to prevent geopolitical and financial risks. We maintain the assumption that central banks will buy an average of 80 tonnes per month in the fourth quarter through 2026, the analysts wrote in the report on Monday.
The bank still expects gold prices to reach $4,900/ounce by the end of next year, supported by sustained buying from central banks and cash flow from private investors in the context of the Fed loosening monetary policy.
