The highest rate of liquidation of “gold reserves” in a decade

The highest rate of liquidation of “gold reserves” in a decade

Turkey and Uzbekistan are the best sellers … and Chinese demand leads the recovery

New York: «Middle East»

Central bank sales increased their purchases of gold for the first time since 2010; In what is called the liquidation of the central reserve of gold, at a time when some gold-producing countries are trying to take advantage of the high prices of gold to record levels, to contain the repercussions of the new Corona virus on the economy.
According to data from the World Gold Council, central banks’ sales of gold increased by 12.1 tons over their purchases during the third quarter of this year, while purchases increased over sales during the same period last year by 141.9 tons.
The agency «Bloomberg» that the central banks ’sales of gold were led by the central banks of Uzbekistan and Turkey, while the Central Bank of Russia’s gold sales increased for the first time in 13 years.
The Turkish central bank sold 22.3 tons of gold during the third quarter of this year, while the Central Bank of Uzbekistan sold 34.9 tons, according to the World Gold Council. Uzbekistan is seeking to diversify the basket of contents of its foreign exchange reserves and reduce the share of gold in it, as part of its efforts to break out of the isolation that has lasted for decades.
For his part, the US bank, Citigroup, expects the return of central banks’ demand for gold to recover next year, after demand slowed during the current year, following the arrival of demand for the yellow metal to record levels in 2018 and 2019.
On the other hand, the World Gold Council expects the continued strong demand for the yellow metal in China, with an improvement in consumer confidence as a result of the country’s exit from the lockdown measures related to combating the Corona virus pandemic and the recovery of the economy.
On Thursday, Bloomberg quoted Andrew Naylor, head of the ASEAN region’s administration and public policy at the World Gold Council, as saying: “If you look at the reasons for the weakness of consumer activity in the gold market, these reasons will fade away in China … All indications are that consumer demand in China. It will continue to grow ».
It is noteworthy that China – the largest consumer of gold in the world – recorded a decline in demand for jewelry during the third quarter of this year by 25 percent annually to 119.1 tons, while demand increased by 31 percent compared to the second quarter of the year, according to the quarterly report. The World Gold Council.
The quarterly growth of gold demand in China was driven by high marriage rates. As many people had postponed their wedding to the third and fourth quarters of this year due to the Corona virus pandemic during the first half of this year.
The Chinese Gold Association announced last Tuesday that gold consumption in China during the third quarter of this year increased significantly compared to the second quarter. The union said in a statement that the quarterly growth of gold consumption in China is due to the recovery of the Chinese economy and the strong activity in the Chinese marriage market.
The union’s statement indicated that gold consumption in China increased during the third quarter of this year by 29 percent compared to the second quarter of the year, while consumption decreased by 29 percent compared to the third quarter of last year, to 548 tons.
At the same time, gold production in China increased during the third quarter by 6.2 percent compared to the second quarter, while it decreased by 4.5 percent compared to the third quarter of last year, to 263 tons.

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