Precious Comment Gold and Central Banks Storage Dilemma

Commodities Research 14 August 2026 | 7:56PM BST

Precious Comment: Gold and Central Banks: Storage Dilemma; Buying Trend Picks Up

n The location of central bank’s gold holdings appears increasingly top of mind Lina Thomas | for reserve managers. The World Gold Council’s survey indicates that the Bank Goldman Sachs International of England remains the preferred custody location among reserve managers Daan Struyven (57% of respondents), but central banks are increasingly diversifying where they | store their gold. Goldman Sachs & Co. LLC

n Liquidity considerations primarily drive the choice to hold gold at the Bank of England and the New York Fed. Gold held at the Bank of England or the Federal Reserve Bank of New York sits within the world’s main gold settlement networks, providing immediate market access, access to dollar liquidity through swaps, and the ability to generate income through leasing. The drawback is that gold held abroad is not free from political risk, including the risk of freezing or restricted access (as in the case of Venezuela’s gold reserves held at the Bank of England in 2018). n But concentrating all gold at home may replace foreign-jurisdiction risk with domestic political and physical risk. Concerns about geopolitical instability were among the reasons some European central banks moved part of their gold holdings to New York during the Cold War. n Our GS nowcast estimates central bank purchases of 57 tonnes in June (100 tonnes/month on a 3‑month seasonally adjusted basis versus a pre‑2022 average of 17 tonnes), with a large contribution from China. We also observed 32 tonnes of monetary gold flowing into London. While this — in principle — could be interpreted as gold being brought to London for sale, we think it more likely reflects a custody transfer. Foreign official gold holdings at the Bank of England rose by 98 tonnes during the month, more than enough to absorb the central bank gold inflow into London. If the gold had been sold, it would ultimately have increased private-sector (i.e., non-BOE) gold holdings in London. Instead, non‑BoE London vault holdings fell. n Structurally, EM central bank diversification — following the 2022 freezing of Russia’s reserves — remains the anchor of our $4,900/toz end‑2026 forecast. We maintain our assumption of average monthly central bank buying of 50 tonnes in 2026 and 40t/month in 2027. n The gold price has increased 10% since the mid-July bottom to nearly $4,400. This rally reflects a recovery in investor demand and likely further central bank purchases. The three key types of investor demand in our pricing framework — Western ETF holdings, COMEX net managed money, and option demand for

Investors should consider this report as only a single factor in making their investment decision. For Reg AC certification and other important disclosures, see the Disclosure Appendix, or go to

Goldman Sachs Precious Comment

macro policy hedges — have all started to recover as the headwind from markets pricing Fed hikes (weighing on rate-sensitive ETF demand) has eased following the July FOMC hold and a softer jobs report. We expect the Fed-related headwind to abate further, as our economists expect no Fed rate hikes.

Our GS Nowcast Estimates Central Bank Gold Purchases of 57 Tonnes in June (100 Tonnes/Month On a 3‑Month Seasonally Adjusted Basis vs. a Pre‑2022 Average of 17 Tonnes)

Source: Goldman Sachs Global Investment Research

The authors would like to thank Samuel Jönsson — an intern on our commodities research team — for his contributions to this report.