We can start this week off with a bang. It’s no secret that central banks bought a lot of gold over the past year, we’ve talked about it many times (here’s one example, and another). This morning, Ronan Manly published a detailed article on central banks’ recent spate of gold buying.
The question: Does central bank buying have any impact on the open market price of gold? Now that’s something we probably should understand, right? The general assumption is that more central bank buying means more demand on the open market — but is it true?
It’s like the book Freakonomics, which looks more deeply at a single question to see if the common wisdom has any “wise” in it at all. We won’t give it all away, but you should understand that Manly doesn’t mention the LBMA‘s coming increase in reporting and transparency, slated to begin on Nov 20. That doesn’t take away from most of the article.
But, it does modify the impact of a few paragraphs. You should definitely read this one all the way through. (Note: The Gold Enthusiast is not affiliated with BullionStar, but we are fans of some of their authors, such as Ronan.)
Continue reading at BullionStar.com