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The latest update from the World Gold Council confirms that central banks continue to place their confidence in gold, with another 31.6t added to reserves in April (the latest date for which figures are available) according to a report released today (Friday).

The numbers show Turkey in particular appears to be in favour of gold, with its central bank adding one tonne of the precious metal to its vaults in April, taking its state reserves to 38.8t.

World Gold Council analysis shows that globally, there are compelling arguments for central banks to continue to hold gold, especially considering the economic turmoil we’re seeing as a result of the COVID-19 pandemic. It says 20% of the world’s central banks will increase their gold holdings this year, following on from high levels of acquisition in 2018 and 2019.

Krishan Gopaul, from the World Gold Council’s Market Intelligence Group said, “This was supported by the findings in our recently published 2020 Central Bank Survey. Not only did 20% of respondents say they intend to buy gold in the next 12 months (up from just 8% in 2019), but factors related to the economic environment – such as negative interest rates – were overwhelming drivers of these planned purchases. This was supported by gold’s role as a safe haven in times of crisis, as well as its lack of default risk.

“Our view remains that central banks will remain net purchasers in 2020.”

The continuing confidence of central banks comes on the back of news released Thursday by the World Gold Council which confirmed ETF gold holdings hit a record high of 3,510 tons in May. 2020’s year to date inflows of 623 tons is substantially higher than the previous 2009 annual high of 591 tons.

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