(Ecofin Agency) - Central bank gold purchases have been a major driving force behind the recent burst in demand for gold worldwide, and subsequently price surge. Gold currently trades at over $2,300 an ounce.

According to a recent World Gold Council survey, 29% of the Central Banks surveyed plan to expand their gold reserves within the next 12 months. This is the highest level ever since 2018 when the annual survey was launched.

"Planned purchases are primarily driven by a desire to rebalance towards a more preferred strategic level of gold holdings, domestic gold production, and financial market concerns, including higher crisis risks and rising inflation," noted the World Gold Council. 

The survey revealed that 71% of respondents reported higher levels of total reserves than five years ago, and 81% of respondents believe that gold holdings should increase, up from 71% in 2023. The study was conducted between February 19 and April 30, 2024, covering 70 apex lenders. 

Its conclusions highlight the lenders’ net gold purchases, one of the factors that spurred the recent rise in gold prices. The purchases reached 33 tonnes in April, against 3 tonnes in March, driving up demand and prices.

Gold has been trading at over $2,300 an ounce since April. The price surge pushed up the earnings of many gold producers, in several African countries notably.