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Central banks remained active gold buyers in October, using lower prices to expand official reserves after a busy third quarter. China again stood at the center of that activity, extending its reserve accumulation streak to two straight years.

In social media posts detailing the October purchases, Krishan Gopaul, Senior Analyst, EMEA, at the World Gold Council, said China acquired 26 tonnes of gold. The purchase lifted the country’s official holdings to 2,435 tonnes.

That total put China just 2 tonnes behind France’s gold reserves, bringing the two countries close to equal footing in official holdings. The comparison reflects the scale of China’s commanding presence in the gold market during its sustained buying campaign.

The Czech National Bank also added to its reserves during October, purchasing 2.5 tonnes of gold. Its total holdings consequently reached 90 tonnes, leaving the central bank 10 tonnes short of its stated target of 100 tonnes.

Gopaul summarized the Czech position in his social media post. “Total gold holdings now stand at 90 tonnes, just 10 tonnes shy of its stated 100-tonne target,” he said.

The Central Bank of the Republic of Uzbekistan was another notable buyer during the month, acquiring 7 tonnes. That purchase increased its net buying for the year to date to 63 tonnes and raised its total gold holdings to 453 tonnes.

“This lifts its total YTD net purchases to 63 tonnes, and total gold holdings to 453 tonnes,” Gopaul said. The figures placed Uzbekistan among the central banks continuing to build reserves as gold prices offered buying opportunities.

Poland recorded an even larger October purchase after a sustained push to increase its official holdings. Gopaul calculated that the National Bank of Poland bought 27 tonnes during the month, helping it reach its target of 700 tonnes.

Reaching that goal may not mark the end of Poland’s purchases. Governor Adam Glapinski said officials should calmly consider what comes after 700 tons, while making clear that he saw no reason for the country to stop buying gold.

Glapinski also said Poland’s gold holdings should increase in line with its overall reserves. His comments left the door open for further accumulation beyond the central bank’s initial 700 tonne objective.

The October buying followed a busy summer for official sector demand. According to the World Gold Council, central banks purchased 321 tonnes of gold during the third quarter, a 42% increase from the same period last year.

Third quarter purchases also came in well above the five year quarterly average of 227 tonnes. The gap between current buying and that longer average reinforced the strength of central bank participation reported by the council.

The World Gold Council expects central banks to remain active in the gold market through the rest of the year. Its quarterly demand trends report said third quarter demand exceeded expectations, while a modest upward revision to second quarter figures reiterated the strength of official sector buying.

The council linked that buying strength with the strategic interest recorded in its surveys and said demand was likely to remain firm in the fourth quarter. At the same time, its analysts cautioned that central bank purchases appeared sensitive to price.

According to the report, that price sensitivity could provide some support and stability for gold. However, the council said the relationship was not stable enough to establish a firm floor beneath the gold price.

October’s figures show the breadth of official reserve accumulation, with reported purchases from China, the Czech Republic, Uzbekistan and Poland. China’s two year buying streak remains a major feature of that demand, while other central banks continue pursuing their own reserve targets.

The third quarter total and subsequent October purchases keep central bank demand firmly in focus for the gold market. With China nearing France’s holdings and Poland considering purchases beyond 700 tonnes, official buyers remain an important source of support.

DISCLAIMER: GoldInvestors.news is not a registered investment, legal or tax advisor or broker/dealer. All investment/financial opinions expressed by GoldInvestors.news are from the personal research and experience of the owner of the site and are intended as educational material. Although best efforts are made to ensure that all information is accurate and up to date, occasionally unintended errors and misprints may occur.