The price of gold has broken records this year, peaking at over $2,400 an ounce in May. Central banks around the world have been buying up gold at an unprecedented rate, thus spurring the hike.

Central Bank’s net gold purchases reached 33 tonnes in April, up from just 3 tonnes in March. In a note published on June 4, the World Gold Council disclosed the figure. According to the note, Turkey's central bank was the biggest buyer, adding 8 tonnes to its official reserves. Other major buyers include Kazakhstan, India, Poland, Russia, and the Monetary Authority of Singapore.

Eight central banks added more than 1t of #gold to their reserves in April. Senior Analyst @KrishanGopaul digs in to the detail in his latest blog. Read it here on #Goldhub: https://t.co/xkTnMZtfl5 pic.twitter.com/Qc1NQR0shR

— World Gold Council (@GOLDCOUNCIL) June 4, 2024

This trend has been ongoing since 2022, when central banks exceeded 1,100 tonnes, a level not seen since 1867. These purchases are driving the rise in the price of gold, which has risen from around $2,000 an ounce in December 2023 to its current peak, $2,400 per ounce.

"Despite the slowdown seen in March, the preliminary pick-up in net purchases in April may suggest that central banks have so far resisted the rise in the gold price and are continuing with their strategic buying plans," says Krishan Gopaul, analyst with the World Gold Council.

African central banks have historically been inactive on the international gold market, but some have recently stepped up purchases on the domestic market, particularly in gold-producing countries. For example, Ghana has launched a program to purchase gold from artisanal miners, and Zimbabwe has introduced a system for paying mining royalties in gold bars. The aim is to build up strategic reserves to support monetary policy in these countries.

Emiliano Tossou