Central banks may have just signaled one of the most significant bullish signs for gold in the upcoming months.
In the annual Central Bank Gold Reserves (CBGR) report, The World Gold Council (WGC) revealed data that shows a shift in the sentiment that many central banks now have towards gold.
Central banks across the globe were surveyed in the CBGR report; none of the banks observed intended to decrease their gold holdings, in fact, 21% intend to increase their gold reserves over the next 12 months.
When you consider that central banks are responsible for overseeing the monetary system of an entire nation, the motivating factors behind their decision are really what stands out.
Historically, the central bank’s top reasons to acquire gold have been its reputation as a safe haven asset and its long-term store of value.
However, gold’s performance during periods of crisis has become their number one reason to accumulate more of the precious metal.
This correlates directly with the majority of the central banks fearing that we are on the cusp of a global financial crisis.
In fact, 45% percent of the surveyed banks said that gold’s performance is highly relevant during periods of market volatility, especially after a year of instability caused by the pandemic.
Even more alarming is that 84% of the respondents share a growing uncertainty for a COVID economic recovery.
Again, we reiterate that central banks oversee a nation or nations monetary system.
So the question becomes, if almost nearly 90% of the banks surveyed fear that the financial and economic COVID recovery will be less than subpar, how should we feel?
Another indicator that bullish times may be ahead for gold is that The Bank of England has seen a significant increase in their volume of premiums and sales.
The Bank of England’s London reserves are home to one of the largest bullion stashes globally and are sold and stored on behalf of other central and commercial banks.
The demand for gold is rising.
In March, the Bank of Thailand increased its gold reserves by over 20%.
Hungary added a substantial amount to its gold holdings and nearly tripled its reserves, making it one of the biggest purchases by a central bank in decades.
If signals by central banks are saying something, it is through their actions.
While the Federal Reserve may be saying everything is fine and we have nothing to worry about with “transitory inflation,” then what are these central banks preparing for?
Do you believe that actions speak louder than words? Call American Hartford Gold today at 800-462-0071 to learn how you can protect your wealth and retirement.