‘In Gold We Trust’: Waning Confidence in US Sends World’s Central Banks on Buying Spree
- ‘In Gold We Trust’: Waning Confidence in US Sends World’s Central Banks on Buying Spree
by Darius Shahtahmaseb, https://www.rt.com/
Governments around the world have recently been on a “gold-buying spree.” These countries have a tactful reason for doing so, and this reason is directly tied to the anticipation of the inevitable end of US hegemony.
Central banks are among the largest purchasers of gold. So far in 2019, they have bought 145.5 tons of gold, which is more in a quarter of a year than central banks have purchased in the preceding six years. To put it bluntly, this figure represents a 68 percent increase from the year before. Last year, central banks increased their reserves by 651.5 tonnes compared to 375 tonnes in 2017. Reportedly, this is the largest net purchase of gold since 1967.
Most interesting, however, is the class of countries that we find are turning to hoarding more and more gold, many of which are deemed to be adversaries of Washington.
As always, Russia is the largest buyer of gold. In 2018, Russia’s Central Bank purchased 274.3 tons of gold. It also dumped 84 percent of its US treasury debts (we will come back to why this is important later.)
Turkey, another country which has signalled a shift away from the US-EU alliance and a greater willingness to cooperate with US economic and military rivals such as Russia, China, and even Iran, has sold off around 38 percent of its US debt and purchased more and more gold.
Other notable nations increasing their gold supply include Kazakhstan , Ecuador, Qatar, Serbia and Colombia, according to recent statistics. Even the Philippines has joined the gold-bandwagon, increasing its gold holdings in foreign reserves, as well as passing gold-specific legislation to assist small-scale miners in the country.