Central banks paused buying as gold rallied, but a comeback looms

Gold's blistering rally — which pushed the metal above $5,500 an ounce before a sharp correction — has temporarily sidelined one of its biggest buyer groups: central banks. Reserve managers remain structurally bullish but have been delaying purchases until price swings calm.

Goldman Sachs points to elevated volatility driven by private-sector diversification, much of it expressed through gold call-option strategies that amplify moves. That volatility has made some emerging-market central banks more hesitant to step in aggressively at current levels, even as they continue to view gold as a hedge against geopolitical and financial risks.

Central banks bought roughly 1,000 metric tons of gold on a net basis in 2023 and 2024, dipping to about 900 tons in 2025 but at higher prices. Spot gold was trading around $4,995 per troy ounce in early Friday trade, up about 16% so far this year. In its base case, Goldman expects volatility to ease and official buying to reaccelerate, which could push gold to $5,400 an ounce by the end of 2026.

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