Central Banks Bought 17% More Gold in 2014 than 2013 – 2nd Best Increase Ever

By – Mike Fuljenz

In 2014, the world’s central banks bought 477.2 metric tons (15,342,000 Troy ounces) of gold, 17% more than they bought in 2013 and the second-highest annual increase in the last 50 years. In a report released in mid-February, the World Gold Council (WGC) said that central banks exchanged about $19.4 billion in paper money for gold in 2014. In the last five years, central banks have bought 1964 metric tons of gold, an average of 393 tons per year. For 2015, the WGC expects central banks to buy another 400 tons of gold, as they continue to dilute their own currencies with more money printing and negative interest rates.

The central bank of Russia was the biggest buyer, accumulating 173 metric tons – almost one-third of all central bank purchases. The Russian ruble was one of the weakest currencies in the world in 2014, so the Russian central bank exchanged their paper rubles (and some U.S. dollars) for real money. In 2014, the Russian ruble fell 46.5% to the dollar and inflation soared 11.4%, but gold gained 73% in ruble terms in 2014. Gold now represents about 12% of Russia’s foreign reserves. Russia is now one of the top five gold-holding nations, behind only the U.S. Germany, Italy and France. After Russia, the next biggest central bank buying in 2014 came from Kazakhstan and Iraq, each of which bought about 48 metric tons.

Gold fell slightly (about $2) in 2014 due to bearish sentiment in America, a slight slowdown in Chinese demand and a large drop in India’s gold imports due to restrictive tariffs. Last year, India imported 523 metric tons, down 27% from 716 tons in 2013. (Although official imports to India were down, gold smuggling probably made up for any decline.) Now that India has loosened some tariffs and promises to loosen more this year, gold buying in India and China – the top 2 gold-buying nations – should increase.


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5 years ago

Is Gold really worth anything?

Take a Gold coin to the store and see how much you can buy.

The Government out-lawed the ownership of Gold once and they would do it again, the next currency is electronic

5 years ago

Summary of the very excellent discussion here. I’d recommend reading it for anyone who is concerned about the possibility of meltdowns in the future, and the role bullion can have in preparing for that. Precious metals should have a place in your portfolio, 3% to 5% is suggested here, but only with prior research and careful purchasing and storage. The investor should become aware of the per/ounce cost of gold or silver and know how to follow its fluctuations, they should be very careful to find a reputable source and to not be paying more than they absolutely have to… Read more »

5 years ago

Let’s say the U.S. Government crashed. All our money is worth less. Don’t think for one little minute that they don’t know where all that gold is at. You’ll get a knock on your door. You will be told to hand over the gold now, or go to jail. Some will hand it over to the government. Others will say per say someone stole it, or I hid it. No matter what you say if you don’t turn it over the government there going to put you in jail tell you hand it over to them. Every bar etc has… Read more »

5 years ago

I’ve been trying to learn about gold and silver and their potential as investments. It isn’t easy, as so much that’s passed off as factual is sophisticated sales pitches. From what I’m learning (for me anyway) silver is preferable to gold. A Silver Eagle, a 1 ounce silver bullion bar or coin or old 90% US silver coins are easily identifiable and not apt to be counterfit. Silver is just over $15 an ounce. It has many essential uses. They purchase of Silver Eagles this year and last is outpacing the amount of silver being mined in the US. But,… Read more »

5 years ago

Gold…………what a scam. When a pimpled faced boy can go into Target and buy his skinny girlfriend a gold necklace how rare is it?………….they mine this stuff 24/7……….

If gold and silver is going to be worth a fortune………then why do these companies want to sell it? Wouldn’t you want to keep it for the “big day”?

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