Central bank gold buying hits highest level in half a century in 2018

Central bank gold buying hits highest level in half a century in 2018

The amount of gold bought by central banks in 2018 reached the second highest annual total on record, according to the World Gold Council (WGC).

Central banks bought the most gold by volume since 1967, according to the industry research firm, which also highlighted it was the largest amount since the decision to end the dollar's peg to bullion in 1971.

Central bank net purchases reached 651.5 metric tons in 2018, 74% higher than in the previous year when 375 tons were bought. The WGC has estimated that central banks now hold nearly 34,000 tons of gold.

The Federal Reserve is reported to hold the most, amounting for almost three quarters of the nation's foreign-exchange reserve pot.

The WGC said the bulk of the buying was carried out by a handful of central banks with Russia leading the way as it looks to swap out dollars from its portfolio. The Russian central bank sold almost all of its U.S. Treasury stock to buy 274.3 tons of gold in 2018, CNBC reported.

The central bank of Turkey increased gold reserves by 51.5 tons in 2018. Other big central bank buyers were Kazakhstan, India, Iraq, Poland and Hungary.

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