Gold prices may have peaked? The central bank’s gold-buying trend is hard to reverse, and the medium- to long-term uptrend logic remains unchanged.

Most central banks’ gold-buying main trend worldwide remains unchanged.

On April 7, the latest data released by the People’s Bank of China showed that, as of the end of March, China’s gold reserves stood at 74.38 million ounces, up by 160,000 ounces month over month, marking the 17th consecutive month of increasing gold holdings.

World Gold Council-disclosed statistics on central bank gold purchases show that in February, global central banks net bought 19 tons of gold, a clear rebound from January. Emerging-market central banks such as those of Poland and Uzbekistan continued their net buying trend.

Recently, influenced by factors including a warming of the geopolitical situation in the Middle East and a period of strengthening of the U.S. dollar, international gold prices have pulled back from high levels. Some central banks, including those of Russia and Turkey, reduced their holdings. However, institutions generally believe that the reductions are more of a tactical operation and are unlikely to change the broader trend of global central bank gold buying. Against the backdrop of a long-term weakening of U.S. dollar credit, the value of gold as a reserve-diversification tool and a credit-hedging asset remains well regarded, and after an oversold correction, it offers opportunities for medium-term positioning.

Russia and Turkey reduce gold holdings

Recently, international gold prices have been range-bound at high levels, and competition between bulls and bears has intensified noticeably. In March, COMEX gold futures prices fell cumulatively by more than 10%, and some short-term sell-off actions by certain central banks also disturbed market sentiment.

World Gold Council-disclosed statistics on central bank gold purchases show that the Russian central bank and the Turkish central bank are the two main net reducers in the gold market in February. Among them, the Russian central bank sold 6 tons of gold in that month. Since the start of the year, it has been in a clearly net-selling range, making it one of the main official gold sellers.

The World Gold Council’s calculations indicate that Turkey’s gold reserves decreased by 8 tons in February, mainly due to changes in the holdings of the Ministry of Finance rather than direct reductions in reserves by the central bank. However, Turkey’s central bank became highly active in March, with estimates that about 50 tons of gold reserves were used for liquidity and foreign-exchange operations.

Fatih Karahan, Governor of the Central Bank of the Republic of Turkey, said: “A large part of these transactions are similar to gold—currency swap futures. In other words, after maturity, the related gold will return to our reserves.”

Regarding the recent behavior of some central banks selling gold, the macro team at Guolian Minsheng Securities believes that these are more tactical than strategic sell-offs. There are three core reasons: first is “trend-following” institutional behavior—central banks also play the role of institutional investors in the gold market, and often reduce holdings during periods of consolidation and increase holdings during periods of accelerated price rises; second, a rapid short-term increase in fiscal deficits leads some central banks to passively sell gold to meet liquidity-related expenditures, and both the central banks of Turkey and Russia fall into this category; third, some central banks’ gold reserves and foreign-exchange reserves offset each other—after a geopolitical conflict pushes oil prices up, some countries face increased pressure for currency depreciation, which makes their central banks sell gold to increase foreign-exchange reserves.

Most central banks are still buying gold

With gold prices staying high, the pacing of gold purchases by central banks in each country has slowed somewhat. However, overall, in February, most global central banks were still increasing their gold reserves.

World Gold Council-disclosed statistics on central bank gold purchases show that in February, global central banks in aggregate net bought 19 tons of gold, rebounding from January’s low level, though still below the 26 tons monthly average in 2025. In 2026’s first two months, global central banks accumulated 25 tons of gold purchases, about half of the 50 tons in the same period last year.

Looking specifically: Poland’s National Bank was the main buyer of gold in February. It increased its holdings by 20 tons of gold in that month, making it the central bank with the largest gold-buying amount in February.

Gold-buying momentum in Asia has also remained steady. Uzbekistan’s central bank has increased holdings for the fifth consecutive month; it bought another 8 tons in February. The People’s Bank of China has increased holdings for the 16th consecutive month; its latest reserve size has risen to 2,308 tons. The Czech National Bank has continued its 36-month streak of increasing holdings. Malaysia’s central bank entered the market for the second consecutive month and increased its holdings by 2 tons that month. In addition, more and more African central banks are beginning to treat gold as a strategic hedging tool. The Central Bank of Uganda officially launched a domestic gold acquisition program in March 2026. It plans to purchase at least 100 kilograms of gold from domestic producers between March and June to bolster reserves and respond to risks from volatility in international financial markets.

Against the backdrop of increasing volatility in gold prices, most institutions believe that the medium- to long-term upward logic for gold has not been fundamentally shaken. In the short term, fluctuations are more like stage-by-stage disturbances rather than a trend reversal.

Guolian Minsheng Securities believes that the main trend of “long-term rise in gold” has not changed. On the one hand, according to institutional estimates, in March, global central banks as a whole were still in net buying territory, with purchases totaling 14.7 tons, including 43.1 tons of increased holdings in the euro area, far exceeding the reduction amounts by Turkey and Russia. On the other hand, the long-term trend of weakening U.S. dollar credit has not reversed. In 2025, the U.S. government leverage ratio surpassed 110%, and the trend of weakening U.S. dollar credit has continued. Historical experience shows that in the periods 1977–1979 and 1999–2008, when U.S. dollar credit was weakening, even if major core economies sold gold on a large scale, the gold price still followed an upward trend. Tactical reductions by a small number of “non-core” central banks do not affect the long-term logic of “weakening U.S. dollar credit—central banks increase gold purchases—gold’s upward trend becoming consolidated.”

Zijin Tientfeng Futures analyst Liu Shiyao said that from a long-term perspective, the continuous worsening of the U.S. fiscal situation, combined with geopolitical games weakening global trust in the safety of U.S. dollar reserve assets, further strengthens gold’s long-term allocation logic as a credit hedge and alternative asset in the monetary system. After an oversold correction, it has medium-term allocation value.

Huaan Futures analyst Cao Xiaojun said that in the medium to long term, factors such as the global trend of central bank gold buying and shocks to currency credit caused by public debt issues still provide solid support for gold prices. Looking ahead to the second quarter of 2026, driven by the impact of rising international oil prices, there is a risk that U.S. inflation may rebound again. The Federal Reserve may temporarily hold off on rate cuts, and the U.S. dollar is likely to maintain a mostly volatile yet relatively strong pattern, thereby exerting stage-by-stage downward pressure on gold prices. However, the long-term upward trend is still difficult to reverse.

（Source: China Securities Journal）