Central Banks Pile In - Q3 Gold Buying Up 41.9% vs Last Year

Key Takeaways

• Central banks added 321 tonnes of gold in the third quarter, up 42% on last year.
• Reserve diversification, not cheaper prices, remains the main reason they are buying.
• High prices kept jewellery and retail bar and coin buyers on the sidelines.

Central banks bought nearly 95 tonnes more gold in Q3 2026 than they did in the same quarter last year. Net purchases reached an estimated 321.2 tonnes, compared with 226.3 tonnes a year earlier, according to the World Gold Council. That works out to a 41.9% increase, which the WGC rounds to 42% (World Gold Council, Gold Demand Trends Q3 2026, 3 November 2026 (https://www.gold.org/goldhub/research/gold-demand-trends/gold-demand-trends-q3-2026)). Buying was the strongest since late 2024 and well above the five-year quarterly average of 227 tonnes.

Who was doing the buying

China was the largest disclosed buyer and added 63 tonnes, followed by Poland with 40 tonnes. The WGC puts the continued demand mainly down to countries spreading the risk in their reserves, with the retreat in prices from the first-quarter average possibly helping them buy (World Gold Council, central banks chapter, 3 November 2026 (https://www.gold.org/goldhub/research/gold-demand-trends/gold-demand-trends-q3-2026/central-banks)).

High prices kept jewellery and retail buyers away

For jewellery customers, the price was still a problem. Gold averaged US$4,262 an ounce over the quarter on the LBMA (PM) benchmark, 23% more than a year earlier, and jewellery consumption fell 17% to 313 tonnes. Bar and coin demand also dropped, down 19% to 268 tonnes. Add everything together, including over-the-counter activity, and total gold demand was 1% lower at 1,369 tonnes (World Gold Council, Q3 2026 data to 30 September 2026 (https://www.gold.org/goldhub/research/gold-demand-trends/gold-demand-trends-q3-2026)).

ETF investors returned after the Q2 outflows

ETF investors returned too, following outflows in Q2. Physically backed gold funds added 211 tonnes and finished the quarter holding a record 4,256 tonnes, with European funds leading the buying at 92 tonnes. The quarterly addition was still 6% below Q3 last year. The WGC suggests worries about inflation and government finances helped bring money back into gold, even as higher bond yields and a stronger US dollar worked against it (World Gold Council, investment chapter, 3 November 2026 (https://www.gold.org/goldhub/research/gold-demand-trends/gold-demand-trends-q3-2026/investment)).

How much of the buying goes unreported?

Official disclosures account for 120 tonnes of net central-bank buying. Estimated unreported transactions make up roughly 63% of the quarterly total, a sizeable share of the purchases. Some transactions are disclosed late and others are not made public. The WGC's 321.2-tonne estimate includes an allowance for that missing information.

What the WGC expects for the rest of 2026

For the first nine months, central banks bought 675 tonnes, putting them 6% ahead of the same period last year. The strong Q3 result has led the WGC to lift its forecast for the full year, with buying now expected to at least match 2025. Continued purchases could help absorb gold while consumer demand is weaker. The WGC also sees signs that central banks respond to price changes, which might mean that when retail is letting the price fall, they are picking up the discount. The WGC's own caveat is that the relationship is not stable enough to imply a firm floor under the gold price (World Gold Council, outlook, 3 November 2026 (https://www.gold.org/goldhub/research/gold-demand-trends/gold-demand-trends-q3-2026/outlook)).

What it means for investors

For Australian buyers the practical question is what the official sector is doing while retail hesitates. Ainslie Bullion clients working to that pattern often handle it through scheduled accumulation such as Ainslie Saver (https://ainsliebullion.com.au/Ainslie-Saver), rather than timing a quarter where the price direction is unclear.

This article is general information only and does not constitute financial advice. Past performance is not indicative of future results. Always conduct your own research or consult a licensed financial adviser before making investment decisions.