Since 2022, central banks have been on a veritable gold-buying spree, currently one of the key drivers of global gold demand. Although 2026 is still in its early stages and allows only very limited projections for central banks’ gold purchases for the year overall, two trends are discernible. On the one hand, China, India and other nations are continuing their structural gold purchases with the aim of increasing their independence from the leading reserve currency, the US dollar. On the other hand, the weaker net purchases compared to the same quarter of the previous years are, on closer inspection, by no means a sign of a reduced appetite for gold among central banks in general.
Gold sales by Turkey and Russia reduce net demand
Whilst Ukraine’s and Russia’s neighboring countries are continuing to steadily expand their gold reserves in 2026 – Poland alone purchased an additional 20 tons of gold in February – other countries are offloading part of theirs. Foremost among these is the Central Bank of Turkey, which has sold almost 60 tons of gold so far in 2026. Unlike China, Turkey is attempting to increase its US dollar holdings to counteract high inflation. Similarly, Russia sold 15.6 tons in February 2026 alone to offset economic pressures and secure liquidity for the continuation of its war of aggression. The sales by these two countries alone are noticeably reducing the total net demand from central banks.
Gold price moves sideways – performance remains positive overall
Despite the double slump in February and March and the current sideways movement of the gold price in the Eurozone, the precious metal has appreciated 8.2 per cent since the start of the year. In the US and the UK, the gold price is up 10 per cent or more. This may seem modest compared to the record gains of 2024 and 2025, but it remains impressive compared to other asset classes.