Central banks continue gold purchasing spree.
An expert on the gold market believes the precious metal is closer today to becoming the world’s reserve currency than it ever has been.
This is the opinion given by precious metals expertAndrew Sorchini, founder of Beverly Hills Precious Metals, during an interview with Mel K on “The Mel K Show.”
Mel K mentioned people from Goldman Sachs, Chase and all the other banks that have previously spoken negatively about gold are suddenly promoting gold, and she asked Sorchini’s opinion about what is happening right now.
Sorchini said gold is still holding at over $2,300 an ounce and about $125 away from the all-time high which he noted is huge.
“And this is just proof that we’re getting closer to gold being the world’s reserve currency. It’s currently the dollar, but no one wants the dollar anymore because it’s not backed by anything at all, not even oil. And that changed last month. So we’re going to start to see more and more people investing in gold and silver. We’re already seeing other countries out there load up on it,” Sorchini said.
Central banks continue gold purchasing spree
Seven months into 2024, gold remains one of the best-performing global assets of 2024, with many of the world’s central banks driving prices up from their high demand.
The central banks of China, Turkey and India are leading the way on this front, with their purchasing sprees resulting in their reserves adding more than 1,000 metric tons (1,102 U.S. tons) of gold in both 2022 and 2023, according to a recent report from the World Gold Council on gold reserves in central banks.
(Related: DOLLAR DEMISE: China selling U.S. Treasury bonds in record numbers in favor of gold, other commodities.)
Global official gold reserves increased by 290 metric tons (320 U.S. tons) in the first quarter of the year, the largest first-quarter increase since 2000 and 69 percent higher than the five-year quarterly average.
China, India and Singapore were among the biggest purchasers of gold in the first quarter of 2024, increasing their reserves by 27.06, 18.51 and 6.57 metric tons, respectively (29.8, 20.4 and 7.24 U.S. tons, respectively).
In May, central banks increased their gold reserves by purchasing 10 metric tons (11.02 U.S. tons) of gold. In the Central Bank Reserves Survey conducted between February and April, 29 percent of central bank respondents indicated that they have plans in motion to continue increasing their gold reserves over the next 12 months.
According to the World Gold Council, this plan is driven by “a desire to rebalance to a more preferred strategic level of gold holdings, domestic gold production and financial market concerns including higher crisis risks and rising inflation.”
“The global economy, as well as gold, seem to be waiting for a catalyst,” said the council in its report. “For gold, we believe the catalyst could come from falling rates in developed markets that attract Western investment flows, as well as continued support from global investors looking to hedge bubbling risks amid a complacent equity market and persistent geopolitical tensions.”
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Watch the video below to learn more about the interview of precious metals expert Andrew Sorchini with Mel K.
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