According to the latest IMF statistics at least 12 countries are known to have increased their gold reserves in March indicating the continuation of a trend now going back more than two years, and one which has been on its own a substantial supporter of the higher gold prices seen over the period. Overall Central Banks appear to have purchased no less than 58 tonnes in the month, which could suggest an acceleration in their increases in holdings if buying at this rate continues throughout the year.
While the majority of these countries only raised their reserves by a very small amount, there were indeed some quite significant purchases – notably from Mexico, which increased its holdings by 16.81 tonnes to a total of 122.58 tonnes; Russia with purchases of 16.55 tonnes giving it total reserves now of 895.75 tonnes; Turkey with 11.48 tonnes taking it to 209.6 tonnes in its reserves. Argentina bought 7 tonnes taking its holdings to 61.74 tonnes, Kazakhstan with 4.3 tonnes – up to 96.16 tonnes and Ukraine with 1.18 tonnes bringing its holding to 29.21 tonnes. A further half dozen countries raised their holdings by increments of less than a tonne.
This, of course, only shows the figures for those nations which are, one assumes, wholly transparent in reporting their gold holdings. There have been some quite sharp ‘upwards adjustments’ in the past from some countries which have been less open in their reporting – notably China which is assumed by most observers to be building its gold reserves strongly over the three years since it last announced an upgrade in its holdings.
The continuing upwards trend in Central Bank purchasing is yet another indicator of unease in the sector about the prospects for those currencies – notably the dollar, the euro, the pound sterling and the Japanese yen – which provide the bulk of their monetary reserves. Gold is seen as probably a much less risky investment in the current environment. It is perhaps time that those gold doubters took note!
Last year Central Banks that do report their statistics were seen to have bought 439.7 tonnes of gold and many gold analysts are predicting similar levels of purchases in 2012. If the March IMF statistics are anything to go by this figure could even prove conservative, although admittedly Central Bank purchases in January and February were very small by comparison with the March figures.