Global Central Bank Gold Purchases Hit Record High, Strong Long-Term Support for Gold Prices
On July 25, 2026, the World Gold Council released a report showing that global central banks net purchased 247 tonnes of gold in Q2 2026, bringing the H1 total to 483 tonnes, up 21% YoY, a record high for the period. This confirms the strategic trend of continued central bank gold accumulation.
Major Buyers: Emerging Market Central Banks Continue to Expand
The report noted that the top three buyers in H1 2026 were China, India, and Poland. The People's Bank of China continued monthly purchases, adding 98 tonnes, bringing its total gold reserves to 2,345 tonnes (5.2% of reserves). The Reserve Bank of India added 76 tonnes, and the National Bank of Poland added 53 tonnes. Central banks of Kazakhstan, Uzbekistan, Turkey, and other Central Asian and Middle Eastern countries also maintained steady purchases.
Drivers: De-dollarization and Geopolitical Hedging
Li Ming, chief analyst at Kuayang Jindao Research Institute, pointed out three core drivers: first, the Fed's rate cut cycle challenges the dollar's credit system, prompting central banks to diversify reserves; second, ongoing Russia-Ukraine conflict and Middle East tensions boost gold's safe-haven appeal; third, restructuring of global trade settlement systems leads some countries to increase gold holdings for financial security.
"The current ratio of central bank gold reserves to total reserves is still far below historical averages, especially in Asia and emerging markets, leaving room for further purchases," Li Ming said. He expects full-year central bank gold purchases in 2026 to exceed 900 tonnes, surpassing the 2022 record of 825 tonnes.
Gold Price Performance: Short-term Volatility, Medium-term Bullish
Boosted by central bank buying, spot gold rose 0.8% on July 25 to close at $2,385/oz. Although gold recently traded in a narrow range of $2,350-2,420, Kuayang Jindao Research Institute believes central bank purchases provide solid support.
Technically, gold has strong support near $2,300 and is at the end of a bullish flag pattern. A break above $2,420 resistance could open the way to $2,500. Fundamentally, U.S. June CPI fell to 2.1% YoY and core CPI to 2.3%, with markets expecting a 25-bp Fed rate cut in September. Falling real rates will further enhance gold's appeal.
Valuation Recovery Opportunities for Chinese Gold Mining Stocks
With higher gold prices, Chinese gold mining stocks are seeing valuation recovery. Zijin Mining (601899) expects Q2 2026 net profit up 35% YoY, driven by higher copper and gold output. Shandong Gold (600547) has steadily increased output at overseas mines (e.g., Veladero) with excellent cost control. Chifeng Gold (600988) and Yintai Gold (000975) also benefit.
Kuayang Jindao Research Institute advises investors to focus on: (1) leading companies with high-quality overseas mine assets and clear production growth; (2) small-to-mid cap miners with high gold price leverage. However, short-term gold price volatility and overseas policy risks remain concerns.
Global Gold Buying Outlook
Over the longer term, central bank gold buying is shifting from tactical to strategic. The World Gold Council expects emerging market central banks to add over 2,500 tonnes in the next five years, led by China, India, Saudi Arabia, and Russia. Additionally, the advancement of CBDCs may indirectly increase gold reserve demand as physical backing for digital currencies.
Geopolitically, uncertainties before the 2028 U.S. election and trade friction risks favor gold. Kuayang Jindao Research Institute maintains its year-end 2026 target range of $2,500-2,600/oz and advises investors to accumulate gold-related assets on dips.
