Otavio (Tavi) Costa on LinkedIn: Central banks are on pace to buy over 1,000 tons of gold again. Despite…
Central banks are on pace to buy over 1,000 tons of gold again. Despite the near-record annual purchases, it's worth noting that these institutions once held…
Otavio (Tavi) Costa
"Central banks are on pace to buy over 1,000 tons of gold again.
Despite the near-record annual purchases, it's worth noting that these institutions once held 80% of their balance sheet in gold
Today, it's barely 20%.
A return to the historical average of central banks holding 40% of their balance in gold could propel gold prices north of $3,000 based solely on that capital dynamic.
Let's bear in mind that these sovereign institutions typically lead massive pools of capital such as traditional investment strategies continue to have one of the lowest allocations to the metal ever."
H/t Daily Chartbook