BofA Sees 20,000-Ton Central Bank Gold Demand Potential
Bank of America estimates that global central banks could add over 20,000 tons of gold to reserves, a demand stream spanning two decades at current purchase rates.
Bank of America projects that central banks could purchase an additional 20,000 tons of gold. This figure represents the total potential demand if all institutions raised their gold holdings to a specific target level. The bank’s analysis uses a 30 percent gold weighting in reserves as the benchmark for efficient allocation.
Current global official gold reserves stand at approximately 36,705 tons. Net purchases reached a record 1,092 tons in 2024. Central bank buying has been a primary driver of price strength since 2022.
China leads the allocation gap
China has the largest potential for new gold purchases. The country would need to buy approximately 5,628 tons to reach the 30 percent reserve target. Japan follows with a potential demand of 1,866 tons.
Switzerland requires an additional 1,192 tons to meet the threshold. Four other economies—Taiwan, South Korea, Saudi Arabia, and Singapore—each need to add more than 700 tons. These figures exclude institutions that already hold 30 percent or more of their reserves in gold.
Record buying since 2022
Turkey is the largest central bank buyer since March 2022. The Central Bank of the Republic of Turkey accumulated 815 tons of gold during this period. Poland ranks second with purchases of 808 tons.
Selling activity has been significantly lower than buying volumes. Sri Lanka sold 387 tons, making it the largest net seller. Suriname followed with 265 tons sold. The disparity between buying and selling volumes underscores the structural shift in reserve management.
Sustained upward pressure on prices
Bank of America states that this potential demand supports current gold prices. The gap between current and target allocations creates a long-term bid for the metal. This dynamic is expected to persist as reserve diversification continues.
The analysis indicates that central bank demand remains a fundamental support for the market. GN auto markets/commodities: gold prices data reflects this ongoing institutional interest. The structural shift in reserves is likely to influence price discovery for years.
