This year, the price of gold has risen by approximately 8% – study
Analysts say that it is primarily central banks that are buying gold, trying to oust the dominance of the dollar or circumvent Western currency sanctions
It is noted that the cause is the consistently high demand from central banks, one of the reasons analysts believe that gold will rise to $2100 per ounce by the end of the year and to $2200 by March 2024.
This is reported by Business Insider.
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Among the leading central banks buying gold are those of countries trying to displace the dollar's dominance in global finance or trying to circumvent Western currency sanctions, namely China, russia, and India.
"We believe that this trend of buying by central banks will likely continue against the backdrop of heightened geopolitical risks and high inflation," the analysts note. "Indeed, the decision by the US to freeze russian currency reserves following the war in Ukraine could have a long-term impact on central bank behaviour."
According to UBS estimates, considering data from Q1, central banks plan to purchase 700 metric tonnes this year, which is less than in 2022, but still above the average of 500 metric tonnes since 2010.
Background. Mind previously reported that in Q1 2023, central banks had bought 176% more gold than over the same period in 2022.
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