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Which central banks are buying gold this year?

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(Kitco News) Even though interest in official gold purchases has slowed this year, some banks are continuing to add to their gold reserves. 

In July, the most active central banks were Turkey and Kazakhstan. 

Turkey boosted its gold reserves to 632.2 metric tons in July from 626 tons reported in June, according to the latest IMF data. Kazakhstan has expanded its gold reserves to 346.7 metric tons in July from June’s total of 345 tons.

In terms of Turkey’s additions it is not yet clear what proportion of that total included deposits from the domestic commercial banks, StoneX head of Market Analysis for EMEA and Asia regions Rhona O’Connell said on Tuesday. 

In the meantime, “Kazakh central bank is reported to have said that it intends to buy 60t this year,” O’Connell noted.

Australia and Mongolia were gold sellers in July, reducing their gold holdings by two tons and six tons respectively.

Russia has not made any significant changes to its gold reserves since Q1 when its precious metal’s holdings reached approximately 20% of gold and FX reserves combined, which is the national Russian limit. In Q1, Russia bought 29 tons of gold with no major activity since then. 

“Based on the evidence of the IMF figures, Russian gold acquisition policy, reflective of a diversification of internal and external risk, started in earnest in 2015; at end–2014 holdings were 1,208t; at end-June they stood at 2,299t,” wrote O’Connell.

China has also reported no changes, which has been the case since September of last year. 

For the first half of the year, IMF figures on official gold purchases reveal a net increase of 293 tons, with most of the activity coming from European countries.

One of the biggest increases came from Turkey with its central bank adding 163 tons during the first half of 2020. India also participated, buying 26 tons during the first half of the year.

The world official sector holdings at the end of June stood at 35,045 tons.

However, with China and Russia no longer actively adding to their gold reserves, this year’s totals are expanding at a slower pace, O’Connell pointed out. Last year’s total central bank net purchases were at 646 tons.

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