Central banks to keep buying gold – RBC

RBC forecast appetite for gold by central banks, mostly in emerging markets, to hit 275 tonnes this year as compared to 409 tonnes last year. That is historically very high.

“Overall, central banks have been net buyers of gold for 14 straight quarters to present, and the demand helped mitigate bullion’s losses in 2014,” RBC said. “We forecast the central bankers could purchase a further 275 tons in 2015, which compares to 409 tons in 2014, the second-largest increase in 50 years.”

In assessing China – which officially reports reserves of 1,054 tonnes – RBC assumes, as many, that the country has been piling up far more gold than publicly stated. Indeed, it puts China’s current reserves at 3,500 tonnes.

If so, that means China would be the third largest reserve holder of gold behind the US and Italy.

RBC also highlighted Russia’s appetite for gold. Russia’s central bank has been one of the largest buyers of gold among central banks doubling its position from 520 tonnes in 2008 to 1,208 tonnes in 2015.

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