Central banks around the world are increasingly bypassing traditional bullion markets to buying gold locally from domestic and small-scale miners, using their own currencies. This strategic shift, revealed in a recent World Gold Council (WGC) report, reflects growing efforts to reduce reliance on foreign exchange, support local industries and lower acquisition costs during a sustained period of high gold prices.
Out of 36 central banks surveyed, 19 confirmed they are already buying gold locally from domestic miners using their local currencies. An additional four central banks reported that they are actively evaluating or planning to introduce similar local gold acquisition programmes, signalling a growing trend towards domestic sourcing and reduced reliance on foreign exchange markets.
The central banks of Colombia, Tanzania, Ghana, Zambia, Mongolia, and the Philippines are turning to domestically mined gold to strengthen their national reserves, according to the World Gold Council.
“One trend that we’re seeing is that some central banks, especially in Africa, Latin America, are starting to buy gold directly from domestic, small-scale gold mines, which have really proliferated because of the higher price,” said Shaokai Fan, global head of central Banks at WGC.
In Ghana, the government—through its newly established GoldBod entity—now requires licensed gold miners to sell 20% of their output to the central bank, paid in Ghanaian cedis at a 1% discount to the London Bullion Market Association (LBMA) price.
As a result, the Bank of Ghana’s gold reserves have risen significantly, from 8.77 tonnes in 2022 to 30.8 tonnes by February 2025, contributing to an increase in the country’s foreign reserves to US$9.4 billion.
Meanwhile, Tanzania implemented a similar directive in 2024, mandating all miners and gold traders to allocate at least 20% of their gold production for sale to the central bank. The policy is designed to help diversify the country’s foreign reserves and stabilise the Tanzanian shilling.
Traditionally, central banks have purchased gold through the global over-the-counter market, primarily based in London. Transactions are usually conducted through major bullion banks and priced in U.S. dollars, euros, or British pounds. These deals typically involve high-purity London Good Delivery (LGD) bars, which meet international trading standards and are stored in secure, high-grade vaults, including those at the Bank of England.
The World Gold Council notes that central banks across Africa, Asia, and Latin America particularly in emerging economies are increasingly adopting this local gold sourcing model. Many of these domestic purchases are guided by the WGC’s “London Principles,” which promote formalisation, adherence to ESG standards, health and safety measures, environmental protection, and responsible refining practices.
Artisanal and small-scale gold often falls short of international Good Delivery standards, requiring further refinement before it can be used in official reserves. As a result, countries such as Ghana and Zambia continue to depend on overseas refineries to process their gold. In contrast, nations like the Philippines and Kazakhstan have established domestic refining facilities, allowing them to handle and upgrade gold locally to meet global trading requirements.
Gold prices have been rising sharply, reaching new highs as global tensions grow and trust in other safe investments weakens. According to data from LSEG, spot gold is now trading at $3,328.3 per ounce an increase of nearly 27% so far this year. Purchasing gold through the international market often requires dollars — a reserve asset.
This typically means central banks must exchange one reserve asset—such as foreign currency—for another. However, that’s not necessary when they use local currency to purchase gold sourced domestically. By buying gold locally from local mines, central banks can reduce costs by avoiding banking fees, intermediaries, and shipping expenses.
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