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The global economic scene is likely to continue the momentum of gold prices in the first half of the current year, given the expectations of interest cuts in a number of major central banks in the world, in addition to the continued desire of global central banks to increase their reserves of the yellow metal, especially with the movement… China Russia is strategically far from hegemony Dollar On economies and financial reserves.
The cash reserve consists of the foreign currencies held by central banks, the gold balance they hold, and the units of Special Drawing Rights, as well as the net reserve position with the International Monetary Fund.
According to data from the International Monetary Fund, the world's central banks have the following:
- $11.9 trillion in foreign currency reserves, at the end of the third quarter of last year.
- US currency reserves amount to $6.5 trillion
- The euro's share is worth $2.15 trillion.
Central banks led by China and Russia purchased 800 tons of gold in the first half of last year, an increase of 14% over the corresponding half of 2022, the World Gold Council announced.
Expected outburst
According to a report by the “ZeroHedge” website, whether the January effect (meaning the weight of the largest percentage of rises in an asset in the first month of the year) will apply to the price of gold or not during 2024, many indicators suggest a flurry in bank buying. Central for the yellow metal in the first half of the year.
According to the site, the measures taken by the Biden administration to isolate Russia with sanctions in the wake of the war with Ukraine will only lead to more Russian desire to continue withdrawing investments from the dollar.
The website added that the sanctions are in addition to the volatility of the ruble, and the wave of new American spending to fuel its proxy wars in Ukraine and Israel, pushing Russia towards this direction.
Third quarter 2023
In the third quarter of 2023, demand for gold rose 8% from its 5-year average to 1,147 tons, but it was 6% weaker than the corresponding quarter of 2022, according to the World Gold Council.
Central banks recorded a net purchase of 337 tons, the third strongest quarter in the Council’s data series, but it was less than the 459 tons recorded in the third quarter of 2022.
Central banks' demand for the yellow metal in the first three quarters of the year remained 14% higher than the corresponding period last year, reaching a record level of 800 tons.
Investment demand in the third quarter of 157 tons, despite rising by 56% year-on-year, was weak compared to the five-year average of 315 tons. Global gold traded funds lost 139 tons in the third quarter.
Investment in bullion and coins fell by 14% year-on-year to 296 tons, although it remained above the five-year quarterly average of 267 tons.
Jewelry purchases declined slightly during the third quarter of last year, down 2% year-on-year to 516 tons amid continued strength in gold prices, and jewelry manufacturing was marginally more resilient, declining 1% to 578 tons due to inventory accumulation.
Mine production reached a record high of 971 tons in the third quarter of 2023, which helped raise the total gold supply to 1,267 tons, an increase of 6% year-on-year. Recycling rates also increased year-on-year, rising by 8% to reach 289 tons. .
After setting a record in the third quarter, mine production also reached a new record level during 2023, amounting to 2,744 tons.
The largest producers
According to data from the World Gold Council issued last June, the top 10 countries in terms of gold production in the world during 2022 are as follows:
- China: 375 tons.
- Russia: 327.7 tons.
- Australia 313.9 tons.
- Canada 194.5 tons.
- United States 172.7 tons.
- Ghana 127 tons.
- Peru: 125.7 tons.
- Indonesia 9 tons.
- Mexico 124 tons.
- Uzbekistan 110.8 tons.
Jewelry
According to the World Gold Council's third quarter 2023 report, the global demand for gold jewelry reached 516.2 tons, down from 525.7 tons in the corresponding quarter of last year.
- Occupied India The demand for jewelry was at the forefront at about 155.7 tons in the third quarter of last year, up from 146.2 tons in the corresponding quarter in 2022.
- China came in second place with a total demand of 153.7 tons, down from 163.2 tons in the third quarter of 2022.
- Demand for jewelry in the Middle East reached 34 tons in the third quarter of 2023, after declining year-on-year by 12%.
- Demand for gold jewelry in the United States reached 29 tons in the third quarter of last year, a 4% decline from the corresponding quarter last year, while demand from Europe reached 13 tons, a 3% decline from the third quarter of 2022.
- Demand from Australia fell by 12% to only two tons, bringing the total demand for gold jewelry to 7 tons in the first three quarters of 2023.
Investment
Investment in gold in the third quarter of 2023 increased by 45%, or 156.9 tons, from 100.5 tons recorded in the third quarter of 2022, and holdings of gold bars and coins fell by 14% year-on-year to record 296.2 tons.
China topped investment in gold bullion and coins with about 82 tons in the third quarter of last year, followed by India with 55 tons.
The demand for gold bullion and coins reached Türkiye 30 tons in the third quarter of last year, the same in Europe, while in the United States it reached 21 tons.
Central banks
In the third quarter, the People's Bank of China regained the top spot among global central bank gold buyers, increasing its gold reserves by 78 tons during the quarter.
In the first three quarters of last year, the bank increased its gold holdings by 181 tons, reaching 2,192 tons (equivalent to 4% of total reserves).
The National Bank of Poland continued its purchasing spree in the aforementioned quarter, adding another 57 tons to the 48 tons it purchased in the second quarter of last year, thus accumulating 105 tons since 2022.
In terms of gold reserves, the ranking of the top 10 countries is as followsIn the third quarter of 2023, according to the World Gold Council:
- United States 8133.46 tons.
- Germany 3352.65 tons.
- Italy 2451.84 tons.
- France 2436.91 tons.
- Russia 2332.74 tons.
- China 2191.53 tons.
- Switzerland 1040 tons.
- Japan 845.97 tons.
- India 800.78 tons.
- Netherlands 612.45 tons.
The Arab countries with the highest gold reserves are as follows:
- Saudi Arabia 323.07 tons.
- Lebanon 286.83 tons.
- Algeria 173.56 tons.
- Libya 146.65 tons.
- Iraq 132.75 tons.
- Egypt 125.97 tons.
- Diameter 98.11 tons.
- Kuwait 78.97 tons.
- UAE 74.26 tons.
- Jordan 37.32 tons.
- Morocco 22.12 tons.
- Tunisia 6.84 tons.
- Bahrain 4.67 tons.
- Sultanate of Oman 1.88 tons.
- Yemen 1.56 tons.
- Mauritania 1.02 tons.
