Global central banks significantly stepped up gold purchases during May 2026, highlighting continued confidence in the precious metal as a strategic reserve asset. Rising geopolitical uncertainty, reserve diversification and long-term inflation concerns continue to encourage central banks to increase their gold holdings.

The sustained buying trend has strengthened the long-term outlook for gold prices and is likely to keep India's jewellery manufacturers, gold financiers and exporters in focus.

✔ Global central banks purchased 41 tonnes of gold in May, compared with around 20 tonnes in April.

✔ Poland remained the largest buyer, purchasing 64 tonnes during 2026 and raising total reserves to a record 614 tonnes.

✔ Uzbekistan added 33 tonnes, with gold now representing nearly 87% of its foreign exchange reserves.

✔ China extended its gold-buying streak to 20 consecutive months, purchasing 25 tonnes in 2026 and increasing reserves to a record 2,331 tonnes.

Persistent central bank buying provides structural support for long-term gold demand. Jewellery retailers may benefit from sustained consumer interest despite higher prices, while gold finance companies could see collateral values improve. However, elevated gold prices may temporarily affect jewellery volumes, and future movements will continue to depend on interest rates, inflation expectations and central bank policies.

Investor Takeaway

Derivative Pro & Nifty Expert Gulshan Khera, CFP®, observes that sustained central bank purchases reinforce gold's importance as a strategic reserve asset and may continue supporting the long-term outlook for the precious metal. Investors should watch how global monetary policy, inflation expectations and jewellery demand interact, as these factors will influence both gold prices and the performance of gold-linked companies.