[COMMODITIES] ⏱ 3 MIN READ • 2026-10-17 12:30:23 UTC JSON API [RAW]

Central Banks Add 1,037 Tonnes of Gold in 2024, De-Dollarization Accelerates

Central bank gold purchases hit a record 1,037 tonnes in 2024, driven by de-dollarization and reserve diversification. This structural demand supports gold above $2,400/oz despite rising real yields.

⚡ EXECUTIVE 30-SECOND INVESTOR MATRIX

🎯 THE SIGNAL

Gold's resilience to rising real yields signals a paradigm shift where central bank demand dominates price action.

📈 BULLISH VECTORS

Gold miners with low all-in sustaining costs (e.g., AISC < $1,200/oz) benefit from sustained high prices and margin expansion.

📉 BEARISH VECTORS

A sharp appreciation of the US dollar (DXY > 110) could pressure gold as emerging market central banks slow purchases.

⚠️ PRIMARY RISK TRIGGER: A coordinated sell-off in gold reserves by major central banks to defend currencies could trigger a price correction.

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Central Bank Demand Breaks Records Central banks purchased a net 1,037 tonnes of gold in 2024, the highest annual total on record and the third consecutive year above 1,000 tonnes. This surge is led by emerging market central banks, with China (225t), Poland (130t), and Turkey (75t) among the largest buyers. The buying spree has pushed global central bank gold reserves to 35,700 tonnes, the highest since 1993. Notably, this demand is price-insensitive, with purchases continuing as gold averaged $2,200/oz in 2024, up 18% year-over-year.

De-Dollarization and Reserve Diversification The share of US dollars in global foreign exchange reserves has declined to 58.4%, down from 72% in 2000, according to IMF data. Central banks are diversifying into gold to reduce exposure to US dollar hegemony and geopolitical risks, particularly following the freezing of Russian assets in 2022. This trend is evident in the gold share of reserves, which has risen to 15.2% from 10.5% a decade ago. The shift is most pronounced in countries with strained US relations, such as Russia and China, but is also gaining traction among neutral nations.

Price Dynamics and Market Impact Despite a 2.0% rise in 10-year TIPS yields to 2.0% (a 200bp increase from 2020 lows), gold has held above $2,300/oz, defying its historical inverse correlation with real yields. This decoupling underscores the structural nature of central bank demand. ETF holdings, however, have declined by 120 tonnes in 2024, offsetting some upward pressure. The gold price is currently testing resistance at $2,400/oz, with support at $2,250/oz. A breakout above $2,400 could trigger momentum buying, targeting $2,500/oz.

Outlook: Structural Shift or Cyclical Peak? While central bank purchases are expected to remain robust in 2025, potential risks include a slowdown in China's buying and a possible reversal in ETF flows. The World Gold Council projects central bank demand to stay above 800 tonnes in 2025, providing a floor for prices. However, if the Federal Reserve resumes rate hikes, real yields could rise further, testing the resolve of central banks. We maintain a bullish bias on gold, with a 12-month target of $2,600/oz, based on the changing correlation regime and continued reserve diversification.