Gold reserves have been an essential component of central bank holding for decades, and their attractiveness shows no signs of slowing down. Globally, central banks are expected to be the biggest net buyers of gold this year. Today, central banks hold nearly 35,000 metric tons of gold, which represents approximately one-fifth of all the gold ever mined. But what is it about gold that has kept it so valued for so long? Since gold has no credit or counterparty problems, it functions as a source of trust in a country and, under all economic circumstances, gold reserves, together with government bonds, are one of the most important reserve assets in the world.
For individuals looking to invest in gold, a top rated gold IRA is a great option to consider. Despite large purchases of gold during the previous decade or two, the four countries still lag behind their Western counterparts: gold reserves represent only 22% of Russia's total stocks and China's gold reserves, of just under 2000 tons, account for just under 3%. Most banks store gold in their underground vaults, although some keep their physical gold in foreign exchange reserves. Taking gold purchases by the central banks of China and Russia as an example, a report by Global Bullion explains that emerging economies are especially exposed to the excesses of the free market and use gold to offset risk. It's a little surprising how the six major central banks (and the IMF, which will form seven) account for nearly three-quarters of all gold holds.
However, the rise in the price of gold did not stop the central banks of India and Turkey from increasing their gold stocks. To prevent a single bank from influencing the price of gold through a massive sell-off, the Central Bank's gold agreements were drafted. Among the last ten gold reserves of the 20 main central banks are India with 562 tons, the European Central Bank (ECB) with 505 tons, Taiwan with 424 tons, Portugal with 383 tons, Saudi Arabia with 323 tons, Kazakhstan with 322 tons, the United Kingdom with 310 tons, Lebanon with 287 tons, Spain with 282 tons and Austria with 280 tons. For example, of its 612 tons, the Dutch central bank has 15,000 gold ingots, or 31 percent, of its gold stocks available; another 31 percent is held by the Federal Reserve Bank of New York.
As expected, the country with the most gold reserves from central banks is the United States, with 8,133 tons.