Central Bank Gold Buying Is Up 17% in First Quarter of 2026

Central banks returned to their long-term goal of diversifying away from a wide variety of fiat currencies – including the U.S. dollar – in order to increase their percentage holdings in gold.

Central bank gold purchases accelerated 17% in 2026, with Q1 net purchases hitting 244 metric tons. The top two gold buyers in the first quarter were Poland (31 tons) and Uzbekistan (25 tons).

As a result of this trend, Goldman Sachs revised its “core” central bank gold demand forecast from 29 tons per month at the start of the year (and a 50-ton/month forecast in March) to 60 tons per month through the end of 2026. Goldman stated their previous estimate underestimated central bank demand since August 2025, due to the fact that British gold trade data didn’t fully capture gold outflows from London, resulting in unrecorded sovereign gold buying. Goldman also reiterated its forecast of $5,400 gold for the end of 2026, up 20% from gold’s recent $4,500 trading level.

Could Gold Reach $10,000 (or $15,000) by 2030?

Other leading analysts are forecasting even higher highs this year. Nicky Shiels, head of research and metals strategy at the Swiss financial advisory, MKS PAMP, said in a recent interview that the Iran war has “reshaped, but not derailed” the bull case for gold. She expects gold to rise by 30% from its recent lows to reach $5,800 per ounce before year-end, while silver’s supply deficit and dual demand make it an even better long-term bet. Her long-term case for gold centers around high U.S. budget deficits leading to dollar weakness, plus a rise in geopolitical risks.

Looking further out, Shiels said it is “unlikely, but possible” that gold will reach $10,000 per ounce by 2030, but “a lot would have to happen for gold prices to reach five figures, including a substantial rotation from U.S. institutional investors out of equities.” She explained that gold’s global market cap (value of above-ground supply) is about 20% of the value of the global stock market. Historically, it can be worth 40%, implying Gold at $10,000/oz with no drop in stocks.

She also compared gold’s potential value against rising U.S. government debt to arrive at an even more dramatic price projection, saying, “Today’s U.S. Gold holdings back only 3% of U.S. government debt; back in the previous wartime era (the last debt expansion era), WWII, about 50% of federal debt was gold-backed,” while “a mere 10% of the US’ debt pile today equates to $15,000” gold.

Shiels said silver could outperform gold in the longer term due to structural supply deficits, and its dual nature. “Silver is caught between its monetary/investment and industrial identities … it faces persistent structural supply deficits where supply is slow to respond, and once both retail and institutional investment flows re-engage simultaneously, the squeeze potential is significant,” she said.

The supply/demand fundamentals for precious metals remain very positive this year and when metals make their next move, we will see far more sales of bullion to a wider array of new customers. History tells us that about one in six of these new precious metals buyers will graduate into the much tighter and potentially more explosive numismatic rare coin market as dealers expose them to the beauty, history, and investment potential of rare coins.

Wholesale Inflation Hits a 6% Annual Rate – Handcuffing the Fed from Further Rate Cuts

Last week, we reported that the Consumer Price Index (CPI) for April came in “hotter than expected,” near a 4% annual rate. Then, the next day, the U.S. Department of Labor reported an oven hotter number, as the Producer Price Index (PPI) rose by a whopping 6% in the past 12 months and +1.4% in April alone. Discounting food, energy and trade services, the “core” PPI was up 4.4% in the past 12 months, so inflation isn’t all energy-related, even though wholesale energy costs surged 7.8% in April alone. As a result of this PPI report, Treasury yields rose, so the new Fed Chairman Kevin Warsh and Treasury Secretary Scott Bessett will have their hands full trying to “sell” another rate cut to the Fed board in its June meeting, since the yield curve is getting flatter. 

This is another reason why gold retreated in the past week. This big rise in interest rates and inflation, lowers the chances for another 0.25% Fed Funds rate cut over the summer months.

Gold fell from $4,700 last week to under $4,500 this week before recovering about $70 per ounce on Wednesday, May 20th, to close at approximately $4,550. Gold’s decline is mostly a reaction (or an overreaction) to the temporarily high inflation numbers released a week ago. Gold traders may also be concerned about uncertainties over the war in Iran and relations with China following last week’s summit meeting between President Trump and Xi Jinping in Beijing.