Central Banks Rein In Gold Purchases as Investment Demand Soars
Dubai, UAE – January 29, 2026 — Central banks trimmed gold buying 20% to 863.3 tonnes in 2025, down from over 1,000 tonnes yearly prior, signaling ample existing reserves amid record prices. The shift channels demand to investors and fintech platforms in regional hubs like Dubai, where gold digitization infrastructure is rapidly expanding.
Poland led central bank buyers with 102 tonnes for the second consecutive year, followed by Kazakhstan, Brazil, Azerbaijan and Turkey. Sellers included Singapore, Russia and Jordan. Industry analysts project purchases may drop an additional 200-250 tonnes in 2026.
Investment demand jumped 84% to 2,175 tonnes, fueled by $89 billion in gold ETF inflows and physical bar purchases. Gold topped $5,300 per ounce after 60% gains in 2025 and 20% year-to-date.
“The highlight is definitely investment demand. The lowlight — the one people may be surprised about — is that central bank demand dropped.”
— John Reade, Market Strategist at World Gold Council
Analysis: Reade’s observation captures the structural pivot in gold markets — from institutional accumulation to retail democratization. High prices swelled reserve values, meeting allocation targets without new purchases, while geopolitical risks and sovereign debt concerns drove investor urgency.
Why This Matters
The central bank pullback creates significant tailwinds for MENA fintech gold platforms. Dubai’s established position as a global gold trading hub now intersects with digital infrastructure: Emirates Gold launched fintech-enabled Gold ATMs, while DMCC unveiled its FinX trading platform. Regional platforms like O Gold enable instant retail purchases, tapping diversification demand previously served by central bank vaults.
Regional dynamics reveal strategic positioning. Turkey’s central bank joined buyers while Jordan sold, reflecting divergent reserve strategies. UAE fintech regulations and Saudi Arabia’s venture funding boom position the Gulf for gold digitization leadership. The Emirates’ physical infrastructure advantage — refining capacity, storage facilities, regulatory frameworks — now merges with digital rails.
This convergence matters for wealth management and remittance corridors. Retail investors seeking inflation hedges gain fractional access to an asset class traditionally requiring substantial capital. Cross-border workers can convert remittances to gold holdings instantly.
What to Watch Next
Q1 2026 central bank purchasing data will confirm the trend’s durability. Monitor transaction volumes on Dubai’s FinX platform and regulatory approvals for additional gold-backed digital products across GCC markets.
Conclusion
The institutional retreat from gold accumulation accelerates fintech-led democratization, cementing MENA’s evolution from physical trading hub to digital innovation center for precious metals in an era of monetary uncertainty.
Sources: Financial Times, Finance Middle East, Finews, Zawya
