Gold-Buying by Central Banks Seen Climbing From Near Decade Low – by Ranjeetha Pakiam and Elena Mazneva (Bloomberg News – September 29, 2020)

https://www.bnnbloomberg.ca/

(Bloomberg) — Gold buying by central banks, an important driver of bullion’s advance in recent years, is forecast to pick up in 2021 after a slowdown this year.

Citigroup Inc. sees demand from the official sector rising to about 450 tons after a drop to 375 tons this year, which would be the lowest in a decade. HSBC Securities (USA) Inc. expects a slight up-tick to 400 tons from an estimated 390 tons in 2020, potentially the second-lowest amount in 10 years.

While the forecasts are far from the near-record purchases of more than 600 tons a year seen in both 2018 and 2019, increased central bank activity will help bolster bullion.

Russia could return to the market next spring and China’s central bank may resume adding to reserves after the U.S. elections, Citi said in a report this month.

This development may have a bigger impact on the market if exchange-traded funds — key drivers of demand in 2020 — slow their buying as global economies recover from the coronavirus pandemic.

For the rest of this article: https://www.bnnbloomberg.ca/gold-buying-by-central-banks-seen-climbing-from-near-decade-low-1.1501222.amp.html

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