Gold expected to hit fresh records as central banks ramp up buying - AMWatch

Central bank demand has become a key pillar of the gold market in recent years. According to AMWatch, gold is expected to reach fresh record highs as central banks continue to increase their purchases, extending a trend that has seen official-sector buying absorb a meaningful share of global supply. This matters because central bank demand tends to be less price-sensitive than jewellery or retail investment demand, providing a steadier source of support for prices.

The development reflects a broader shift in reserve management. Several central banks have looked to diversify reserves away from traditional currency holdings, and gold's role as a liquid, non-yielding store of value has made it a beneficiary of that strategy. Persistent buying can tighten available supply and amplify price moves, particularly when investor demand rises at the same time.

What to watch: the pace of reported central bank purchases, any signs of slowing, and how prices respond around record levels. Also monitor real interest rates and the US dollar, which historically influence gold. Strong official-sector demand does not guarantee further gains, but it changes the market's underlying balance.