I n May, the world central banks increased their official holdings of gold by 41 tonnes, according to the recently released data from the World Gold Council. The reason why this figure is remarkable is the fact that this happened against the background of falling gold prices, not rising ones.
The bulk of May's purchases were concentrated among a familiar group of buyers:
- With purchases of 18 tonnes, Poland ranked highest on the list. This was the fourth successive month where Poland recorded double-digit gold purchases and took their purchases to 64 tonnes year-to-date and increased their holdings to 614 tonnes, moving towards reaching their target of 700 tonnes.
- China made purchases of 10 tonnes of gold, and this was their 20th consecutive month of purchases and the largest purchase since December 2024. Gold accumulation by China is now 2,331 tonnes, and this represents about 9% of total reserves.
- Gold purchases of 9 tonnes were made by Uzbekistan and brought their year-to-date total purchases to 33 tonnes, second only to Poland. At present, gold accounts for 87% of total reserves in Uzbekistan.
- Gold purchases of 7 tonnes were made by Kazakhstan and took their year-to-date total purchases to 20 tonnes.
- Singapore once again made net purchases of 4 tonnes of gold, the first such purchases since September 2025, bringing their total holdings to 197 tonnes.
- Small purchases of 2 tonnes and 1 tonne each were made by the Czech National Bank and the Central Bank of Jordan.
Turkey and Russia, on the other hand, remained the top sellers of the month, selling 3 tonnes and 6 tonnes of the precious metal, respectively. So far, both of these countries have been net sellers of the year, with Turkey having sold 81 tonnes less and Russia 34 tonnes less. Both of them have acted due to domestic economic issues rather than lack of faith in gold as such.
Purchases by central banks are usually talked about during the rise of gold prices. The importance of May's transactions lies in the fact that they took place against a background of price decline.
Prices had reached a record high of about $5,589 per ounce in late January this year. By early June, prices had fallen considerably and, in fact, lower than their starting point for the year. According to estimates, the price of gold had gone below zero for the year 2026.
The decrease had been caused by the strength of the dollar and persistent inflation due to disruption of oil traffic through the Strait of Hormuz, which occurred after the intensification of US-Iran conflict in late February.
Nonetheless, central banks continued to buy even with that context. This fits into a larger trend:
In the World Gold Council's ninth annual Central Bank Gold Reserves Survey, 89% of central bankers indicated that they foresee global gold reserves continuing to grow over the next 12 months, irrespective of price action.
May’s 41 tonnes is just one small part of an enormous trend that has been developing since 2022. In that year, the freeze on about $300 billion worth of assets belonging to the Russian central bank in the wake of sanctions from the West was an eye-opener for all reserve managers around the world.
It proved that foreign currency reserves, i.e., dollars, euros, and government bonds held overseas, can be frozen or restricted instantly if the geopolitical relationship worsens. Gold, however, remains a tangible asset that is not within another country's jurisdiction if held domestically.
Consequently, the amount of gold held by central banks, particularly those of developing countries and the Global South, has become a progressively higher share of their reserves.
The purchases of gold by central banks on an annual basis have risen from 400-500 tons annually prior to 2022 to more than 1,000 tons annually in 2022 and were sustained until 2023 and 2024. In 2025, 863 tons were purchased by central banks. In 2026, according to J.P. Morgan and other reputable organizations, the purchase of gold by central banks will be estimated at between 750 and 850 tons per year.
The amount of gold net-purchased by central banks was 244 tons in the first quarter of 2026, which indicated a year-on-year rise of 3% despite the high price of gold reaching its peak of all time. More significantly, according to Morgan Stanley Research, gold has been taking a larger share of central bank reserves than US treasuries for the first time since 1996.
It’s worth noting that analysts tracking the phenomenon stress the fact that the gold purchasing of central banks differs completely from that of private investors and speculators. Reserve managers want to ensure the safety of their national funds for decades ahead while minimizing reliance on a particular foreign currency and acquiring an asset that behaves well precisely under such circumstances as sanctions, foreign currency troubles, and sovereign defaults.
That is why May’s purchases amid falling prices don’t seem odd to industry experts. On the contrary, they confirm the structural nature of the trend.
