According to data from the World Gold Council, central banks and other official institutions purchased approximately 289 tonnes of gold in the second quarter, up 62% year over year.
That kind of volume is no longer just a small addition to global reserves. It represents hundreds of tonnes of physical metal moving into the hands of institutions whose investment horizons are measured more in years and decades than in weeks.
Gold has one fundamental characteristic as a reserve asset: it is not the liability of another country, bank, or company, and it carries no direct counterparty credit risk. This gives it a different role alongside foreign currency reserves and government bonds.
That is why I think central bank purchases are worth watching separately from the daily activity in the futures market. 289 tonnes of physical gold in just three months is a flow that could matter far more to the long-term structure of the gold market than short-term changes in speculative positioning
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