Global central banks' Q2 gold purchases hit record high; gold price tops $2,850

On July 25, 2026, the latest data released by the World Gold Council showed that global central banks' net gold purchases reached 285 tons in the second quarter, up 15% year-on-year, the highest for any Q2 on record. Boosted by this news, spot gold prices in New York trading on July 24 broke through the $2,850/oz mark, hitting a high of $2,858.20/oz, with year-to-date gains exceeding 18%.

Central Bank Gold Buying Spree Continues

The report noted that the main buyers in Q2 were still central banks from emerging markets. The People's Bank of China increased its gold reserves for the 18th consecutive month, net purchasing 42 tons in Q2; the Reserve Bank of India followed with 38 tons; Turkey, Poland, Kazakhstan, and others also maintained high purchase activity. In addition, some Middle Eastern central banks that previously bought less gold have also stepped up allocation, reflecting the accelerating trend of global foreign reserve diversification.

Chen Junjie, senior market analyst at the World Gold Council, said, "Geopolitical tensions persist, and the dollar credit system faces challenges. Central banks are increasing gold holdings to hedge risks and optimize reserve structures. This trend is expected to continue in the second half of the year, with total central bank gold purchases likely to exceed 1,100 tons for the full year." In fact, global central banks' gold purchases in 2025 had already hit a record 1,056 tons, and 2026 is expected to set a new record.

Multiple Factors Underpin Gold's Upside

In addition to central bank buying, the shift in Fed monetary policy expectations also provided strong support for gold. Last week, Fed Chair Jerome Powell hinted at a possible rate cut in September if inflation continues to decline, during congressional testimony. Markets subsequently priced in a 72% probability of a September rate cut. The rate cut expectations pushed the dollar index down to around 100.5, a 15-month low, and falling real rates significantly enhanced gold's appeal as an allocation.

Meanwhile, holdings of the world's largest gold ETF, SPDR Gold Trust, increased by 8.2 tons to 1,345.6 tons on July 24, the highest since 2023, indicating that institutional investors are actively returning.

Silver and Platinum Strengthen in Tandem

Gold's strong performance also boosted sister metals like silver and platinum. Spot silver broke through $42/oz that day, a high since 2021; platinum stood above $1,100/oz, up 12% year-to-date. Analysts noted that strong industrial demand from the photovoltaic sector for silver, combined with the high gold-to-silver ratio correction, makes silver a potential high-beta play in the precious metals space in H2.

Investment Advice and Risk Warning

• In the short term, rate cut expectations and central bank buying resonate, potentially pushing gold to $2,900.
• In the medium term, focus on the US election outlook, inflation stickiness, and Middle East geopolitical developments.
• Investors are advised to allocate gold assets prudently, diversifying through gold ETFs, physical bullion, or futures contracts.

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