Central Bank Gold Buying Hits Two-Year High, Fueling Record-Price Bets - Seoul Economic Daily

Central banks added to their gold reserves at the fastest pace in two years, according to Seoul Economic Daily, a development that has renewed attention on the metal's role in official reserves. The buying reflects continued demand from monetary authorities seeking to diversify reserve holdings, a trend that has persisted across multiple quarters.

The significance for markets lies in the demand backdrop. Central bank purchases represent a steady, price-insensitive source of demand, distinct from jewelry or retail investment flows that react more sharply to price swings. When official-sector buying accelerates, it can tighten available supply and reinforce expectations among some market participants that prices could test new highs.

What to watch: whether the pace of purchases is sustained in coming months, and how it interacts with other drivers such as interest rates, the U.S. dollar, and ETF flows. Central bank demand alone does not determine prices, but it is one input worth tracking alongside broader macro conditions.