LONDON (Reuters) - The world’s central banks sold more gold in August than they bought, the World Gold Council (WGC) said on Wednesday, ending a year and a half-long run of monthly gold accumulation and helping stall a rapid rise in gold prices.
Gold XAU= surged from just over $1,500 at the start of 2019 to a record high of $2,072.50 in early August, before slipping to around $1,900.
European and North American investors have driven the price rise, stocking up on gold in the hope it will hold its value though the coronavirus crisis.
But demand from other major consumers such as jewellery buyers and central banks has been weak, raising fears about the durability of the rally.
Central banks - which together hold around 35,000 tonnes of gold worth $2 trillion - sold 12.3 tonnes more than they bought in August, the WGC said.
Uzbekistan sold 31.7 tonnes, offsetting smaller purchases by countries including India, Kyrgyzstan and Turkey, the WGC said.
Central banks bought 656 tonnes of gold in 2018, the most in half a century, and 650 tonnes last year.
“Despite August’s activity and the slower pace of accumulation in 2020, we expect central banks to remain net purchasers for 2020 because they have so far accumulated between 200-300 tonnes this year,” said WGC research manager Krishan Gopaul.
Reporting by Peter Hobson; Editing by Mark Potter
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