Continued Strong Central Bank Demand for Gold Predicted by TDS

Central banks have been increasingly purchasing gold, with near-record amounts bought in 2022 and 2023. Economists at TD Securities predict that this trend will continue, expecting strong demand from central banks in the coming years.

Approximately a quarter of central banks plan to increase their gold holdings this year, indicating a sustained interest in gold among these institutions. This demand is driven by central banks’ belief that the future role of the US Dollar may diminish, as highlighted in recent surveys.

Factors such as concerns over purchasing power erosion, default risks associated with growing US debt levels, and geopolitical tensions in regions like the Middle East and Eastern Europe contribute to the renewed interest in gold. These factors not only provide support for gold prices but also have the potential to fuel speculative rallies in the market.

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