Why central bank buying has the gold market guessing
“The gold market was caught by surprise when two of eastern Europe’s biggest economies, Poland and Hungary, made rare purchases in recent months. Why central banks buy gold is often a major topic of market speculation. Were Poland and Hungary signaling worries about economic conditions? Were they cutting exposure to the dollar? Or maybe hedging against potential European Union sanctions?”
USAGOLD note: How about “all of the above”. . . plus a few incentives not mentioned. The image is from a Hungary central bank information release on its recent 28-tonne acquisition during the first two weeks of October. Central bank gold acquisitions are rarely, if ever, announced in advance, so there is no way to know how much of this sort of thing is going on around the world at any given point in time.
Repost from 10/28/2018