Central banks see gold as a reserve asset and will likely increase their holdings of the metal in the next twelve months, according to a survey by the World Gold Council.
“The geopolitical situations are much more volatile and we don’t know how much longer this situation will persist,” said Shaokai Fan, global head of central banks at WGC, in an interview. “What has happened is gold has proven its safe haven characteristics during that situation. That’s one aspect that central banks are considering.”
Emerging markets central banks are optimistic about gold’s future in the international monetary system, and they’re on the fence about the US dollar, said Fan. The survey also showed a majority of such respondents expect gold to grow in proportion to total reserves over the coming years, with its attributes as a safe-haven store of value and ability to perform during times of crisis remaining influential.
The survey was conducted between Feb. 23 and April 29 with a total of 57 responses.
(By Yvonne Yue Li)