Golden age for Central Banks
They are expected to buy 100 more tons by the end of the year, which is a major step up from the average 400 tons of gold sold over the past 15 years.
A World Gold Council report indicates gold demand is up 6% compared to the same period last year. Marcus Grubb, the managing director of the World Gold Council, says gold can serve as a hedge against increasingly risky currencies. He believes the overall surge in investor demand for gold was caused by insecurities in both the dollar and euro – the US being unable to figure out a comprehensive policy to reduce its now 15 trillion dollar debt and Europe being immersed in its sovereign debt crisis.
The Central Bank of Russia says it will boost its gold reserves. It currently has 800 tons, which is still less than the gold reserves of China at 1054 tons.
Gold prices grew by over 25% this year.