There is a global tendency towards pulling away from the US Dollar as the world’s reserve currency since the end of the Second World War, and in the absence of options, Central banks and sovereign wealth funds are increasingly growing their gold holdings and moving them closer to home, according to a recent survey of 85 sovereign investors and 57 central banks between January and March, quoted by Business Insider, where about 41% of survey respondents expect to increase gold allocation in their portfolios over the next three years.
The US Dollar has been the foreign exchange reserve of choice for Central Banks; 70% of total global reserves were held in US Dollars in 1999, but according to the International Monetary Fund, the Dollar’s share in global foreign exchange reserves fell to under 60% in the fourth quarter of 2021.
Shiny gold is always an interesting subject; for that reason, on December 11, 2020, we published a very interesting video regarding the history of gold from 1891 to 2020. We invite you to watch it again or for the first time if you are new to SEPGRA.
Physically-backed gold exchange-traded funds (gold ETFs) are an important source of gold demand, with institutional and individual investors using them as part of well-diversified investment strategies. Here is some interesting data about it:
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Graph: gold.org
And now, the outlook:
20230706_Mid-year-Outlook-2023To read the whole document, the controls for turning pages and zooming in or out are at the bottom left corner above.
Further Reading: