Why central banks like gold
This, one can almost speak of a gold rush, of course has its reasons. In 2019 alone, around 650 tons of gold were added to the reserves of central banks worldwide. That was the second highest amount in 50 years. This year it will be less, since they bought "only" 8.4 million ounces of gold from January to August, compared to 15.8 million ounces of gold in the same period in 2019.
The reason for the decline is certainly the high price of gold. But the central banks will continue to buy. A gold bar always retains its value, crisis or no crisis. If a central bank owns gold, this promotes confidence. Central banks are supposed to give their currency stability and protect the banking system, hence the focus on inflation.
The central banks want to use gold to reduce risks. Because "gold is money, everything else is credit," says JP Morgan. Gold should also serve as a hedge against inflation. And central banks should promote the economy. And they do this by devaluing currencies slightly over time. This in turn is beneficial to the value of gold.
The US Federal Reserve owns the most gold (8,134 tons), followed by Germany (3,364 tons). Whoever wants to hedge with gold, just like the central banks, should look around the gold companies, for example.
For example, with GoldMining. - https://www.youtube.com/watch?v=42YOOPxclKU&t=7s - The company, with founder and chairman Amir Adnani, owns gold and gold-copper projects in Canada, Brazil, Colombia, Peru and the USA. GoldMining has also established its own royalty company.
Osisko Gold Royalties - https://www.youtube.com/watch?v=wbpv6weLNlg - is also interesting, especially in connection with royalty companies. The portfolio, which is focused on North America, comprises more than 138 royalties and precious metal purchases.
Recent company information and press releases from GoldMining (www.resource-capital.ch/en/companies/goldmining-inc/) and Osisko Gold Royalties (www.resource-capital.ch/en/companies/osisko-gold-royalties-ltd/).
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