By Mike Fuljenz
The World Gold Council reported that central bank demand for gold rose 22% in the third quarter of 2018 vs. the same quarter in 2017, reaching the highest level of quarterly demand since Q4 2015. This also marks the highest year-to-date central bank demand in the first nine months of any year since 2015.
In the third quarter, Russia added the most of any nation – 92.2 metric tons – pushing its total reserve to more than 2,000 tons, as Russia is basically divesting itself of most of its U.S. Treasuries in exchange for gold. Turkey was the second-largest gold accumulator last quarter, adding 18.5 tons in a quarter when its beleaguered currency (the lira) lost 25% to the dollar. India is next in line, adding 13.7 tons of gold last quarter. Kazakhstan was the fourth biggest buyer last quarter, adding 13.4 tons, bringing its total holdings to 335.1 tons, up from just 131 tons five years ago.
Over the last five years, the largest accumulators of central bank gold have been Russia and China.
Such massive levels of gold buying by Russia and China should raise red flags in Washington, D.C. These two superpowers have been in the process of selling their dollar-based Treasury holdings and buying gold to gain more financial flexibility – something that every wise investor should consider doing now.
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