The World’s Largest Gold Reserves
In times of economic downturn or geopolitical uncertainty, many investors prefer to stash their money in gold. This can be beneficial to countries that have large reserves of the yellow metal in their vaults.
The US holds the top spot with over 8,000 tonnes of gold in its vaults, closely followed by Russia and China. For six years in a row, Russia has been the largest buyer of the metal.
1. India
India is one of the largest gold reserves in the world. It has almost as much stockpile of gold as the next three top countries combined (Germany, Italy, and France).
The country is a major consumer of gold. It has a trade deficit with the rest of the world and relies on gold imports to help reduce this gap.
The state government in Bihar has decided to give permission for exploration of the country’s largest gold reserve, which is located in Jamui district. The local government is in consultation with agencies engaged in exploration, including the Geological Survey of India (GSI), to tap these reserves.
2. Japan
Japan is a fascinating country of economic and business prowess, rich culture, technical wizardry, spatial conundrums, and contradictions. Its economy is highly developed and is one of the world’s top three by nominal GDP.
Central banks stockpile gold for several reasons, including its ability to maintain value in times of high inflation and currency exchange rate fluctuations. It also serves as a diversifier for countries’ foreign reserves.
Japan’s gold reserves are worth more than $21.7 billion at today’s prices, and comprise 5.9 percent of the country’s total foreign reserve. In addition, the country’s central bank is a significant holder of gold, with a reported 465.6 tons of gold.
3. Germany
Germany is one of the largest gold reserves in the world, with gold accounting for two-thirds of its foreign reserves. Its reserves are held at four storage locations, including the Federal Reserve Bank of New York (Fed), Bank of England, London and Banque de France in Paris.
Among the reasons why Germany holds so much gold is that it was part of the Bretton Woods system, which tied the dollar to gold and provided a monetary anchor in times of economic uncertainty.
In response to growing questions about the security and availability of Germany’s gold, the Bundesbank announced in 2013 that it would repatriate a significant portion of its foreign reserves from vaults in New York and Paris. It has now completed this effort, moving 583 tons out of those vaults and onto its own premises in Frankfurt.
4. China
Gold is a precious metal that has long been used as a means of exchange. It is also used as an asset to protect against inflation and recession.
In recent years, countries around the world have been ramping up their gold purchases. China is no exception to this trend.
The People’s Bank of China (PBoC) increased its monthly gold purchases by 32 tons in November, the first increase in three years. This brought the total holdings to 1,980 tonnes, according to the State Administration of Foreign Exchange.
This is a significant move by the Chinese government, especially as it prepares to reduce its reliance on the US dollar. It is also a sign that the Chinese state will be using its gold reserves to help strengthen the Yuan Renminbi, its own currency.
5. Switzerland
Switzerland is home to the world’s largest gold reserves. The Swiss National Bank (SNB) stores about 1,040 tonnes of the precious metal, which is worth roughly 7.8% of its foreign currency reserves.
It also has the largest gold refineries in Europe. These facilities refine almost two-thirds of the world’s total production.
The Swiss gold industry is a major contributor to the economy and it also helps fund the country’s foreign trade.
The country’s political system is characterized by direct democracy and decentralization, with each of its 26 cantons having substantial power. The country’s civil liberties are generally respected, though some laws and policies have reflected growing societal wariness over immigration and minority groups.