Central banks are going gaga over gold.
They are snapping up the metal at the fastest rate in almost half a century in a trend that looks set to continue.
Over the 12 months through March 31, they purchased a whopping 715.7 metric tons of gold bullion worth around $29.4 billion, according to a recently published report from the industry group World Gold Council.
"In all likelihood, we expect another strong year," says Alistair Hewitt, director of market intelligence at WGC in London.
He notes that the volume of gold purchased by such institutions over the most recent four quarters was higher than for any calendar year since 1971. That was when President Richard Nixon pulled the U.S. off the gold standard monetary system at a time when gold was worth $35 a troy ounce.
Gold was recently fetching around $1,278 an ounce, down from the year's high of $1,341 reached on February 19. Prices for the SPDR Gold Shares exchange-traded fund, which holds bars of solid bullion, have moved similarly.