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A growing number of countries are bringing their physical gold reserves home to avoid Russian-style sanctions on their foreign assets, while increasing their purchases of the precious metal as a hedge against high levels of inflation. Central banks globally made record purchases of gold in 2022 and in the first quarter of this year, as they sought safe havens from high inflation and bond price volatility, according to a survey of sovereign investors by the Invesco asset manager. China and Türkiye together accounted for almost a fifth of these purchases. Concerned by the decision by the US and others to freeze Russian assets, central banks opted to buy physical gold rather than derivatives or exchange-traded funds that track the price of the metal. And they also preferred to celebrate it in their own country as global tensions increased. The Invesco survey found that 68 percent of central banks held some of their gold reserves in the country, up from 50 percent in 2020.
In five years, that figure is expected to rise to 74 percent, the survey showed. survey. “Until this year, central banks were willing to buy or sell gold through ETFs and gold swaps,” said Invesco head of official institutions Rod Ringrow. “This year Job Function Email Database it has been much more about physical gold and the desire to have gold in the country rather than abroad with other central banks. . . “It is part of the reaction to the freezing of the Bank of Russia's reserves,” he said. Just after Moscow began its full-scale invasion of Ukraine, the EU, US and other G7 countries announced they would impose sanctions on Russia's central bank and prevent it from accessing some $300 billion in foreign reserves. The EU is now considering the legal implications of diverting interest from these holdings to Ukraine. According to the survey of 57 central banks and 85 sovereign wealth funds managing some $21 trillion in assets, many sovereign investors were “concerned” about the precedent set by the seizure of Russian assets, with 96% saying additional investment in gold was driven by its safe haven status.
We increased the exposure eight or ten years ago and kept it in London, using it for swaps and to improve returns,” a central banker from a Western country told Invesco. “But now we have transferred our gold reserves to our own country to keep it safe; “Its function now is to be an active refuge.” Global gold demand hit an 11-year high of 4,741 tonnes in 2022, up from 3,678 tonnes in 2020, driven by central bank purchases and increased interest from retail investors, according to research from the World Gold Council. But while there was demand for physical gold, gold ETFs suffered combined outflows of almost 300 tonnes in 2021 and 2022. Other countries that have made significant purchases of gold include Singapore, India and the central banks of the Middle East. The central bank's record gold purchase in 2022 contributed to a powerful rally in bullion prices, although prices have fallen back to $1,923 per troy ounce in recent weeks on the prospect of higher interest rates in the US for longer.
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發表於 2024-3-9 11:40:19