The biggest owners of gold are tiring of the metal.
Central banks — holders of about 32,900 metric tons of bullion — cut their purchases by 40 percent during the three months through June, compared with the same period a year earlier, to the lowest since 2011, World Gold Council figures compiled by Bloomberg show. It was the third-straight quarterly drop, the longest such streak in at least five years.
Buying declined in 2016 as prices were rallying for their biggest first-half gain in 40 years. Central banks in emerging-market nations have been adding less gold as the amount of cash they get from exports declined, said John Nugee, a manager of Bank of England reserves in the 1990s.
“The flows have slowed dramatically,” said Thorsten Proettel, a commodity analyst at Landesbank Baden-Wuerttemberg in Stuttgart. “This could be a very important factor for the market.”
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