Why Central Banks Drove Global Gold Demand to Decade High in 2022

Global gold demand rocketed to a new decade high in 2022 and it wasn’t retail buyers or investment firms driving the increase. It was the central banks.

According to a report by the World Gold Council (WGC), central banks purchased the most gold since 1950 in 2022. It revealed that central banks purchased a whopping 1,136 tons of gold in 2022, an incredible 152% increase over the previous year. 

The report also highlighted that central banks from emerging markets were the driving force behind the increase in gold purchases. These banks have been diversifying their reserves away from the US dollar and into gold as a hedge against inflation and geopolitical risks.

The WGC report also revealed that gold demand from investors and consumers increased by 7% in 2022, driven by strong demand from China and India.

The rise in gold purchases by central banks and consumers is expected to continue in 2023, with many analysts predicting that gold prices will remain strong due to ongoing inflationary pressures and uncertainty in the global economy.

Overall, the WGC report suggests that gold remains a vital asset for central banks and investors seeking to diversify their portfolios and protect their wealth in uncertain times.

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