A new report from the World Gold Council indicates that due to increasing pessimism towards the US dollar, central banks around the world are expected to increase their global gold reserves next year.
The survey shows that over 80% of respondents anticipate an increase in global gold reserves. Additionally, data reveals that approximately 30% of central banks, including 13% from developed economies, plan to increase their gold reserves in the coming year.
While emerging market banks remain optimistic about the future of gold reserves, 57% of central banks in developed economies currently hold the same view, higher than the 38% in 2023.
At the same time, they are becoming increasingly pessimistic about the prospects of the US dollar’s share in the world’s reserves – with 56% believing this share will decrease from the previous year’s 46%. Nearly two-thirds of emerging market central banks share the same view.
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They are refocusing on gold for reasons such as risk management, emergency plans for political and economic turmoil, utilizing its long-term value, its liquidity, and as part of portfolio diversification.
In the past few years, central banks worldwide have been purchasing large amounts of gold. For example, in 2023, 1,037 tons were purchased, ranking second only to the 1,082 tons purchased in 2022.
