The World Gold Council’s second quarter report showed that overall demand improved in the first half, although not to pre-pandemic levels, mainly due to a Covid resurgence in India. While this was as expected, the level of central bank demand was a significantly positive surprise.

Central bank net purchases totaled 333 tonnes in the first six months of the year, in line with the high levels seen before the pandemic when Russia and China were the heavy buyers. This year both of those countries have refrained from buying, while Thailand, Hungary and Brazil have stepped in as the largest purchasers. Thailand’s central bank governor indicated that gold addresses the key reserve management objectives of security, return, diversification and tail-risk hedging.

MVIS Global Junior Gold Miners Index


Source: MV Index Solutions. All values are rebased to 1,000. Data as of  31 July 2021.

About the Author:

Joe Foster has been Portfolio Manager for the VanEck International Investors Gold Fund since 1998 and the VanEck – Global Gold UCITS Fund since 2012. Mr. Foster, an acknowledged authority on gold, has over 10 years of dedicated experience in geology and mining including as a gold geologist in Nevada. He has appeared in The Wall Street Journal, Financial Times, Barron's, and on Reuters, CNBC and Bloomberg TV. Mr. Foster has also published articles in a number of mining journals, including Mining Engineering and Geological Society of Nevada.

The article above is an opinion of the author and does not necessarily reflect the opinion of MV Index Solutions or its affiliates.