For decades the United States Dollar has been considered ‘the’ global currency. Every country in the world respected, trusted and held our dollar in high esteems.
However, the tide seems to be changing as countries are turning their attention and investments elsewhere.
China, the world’s largest gold consumer, recently provided domestic and international banks with the green light to begin massive gold imports into their country.
An estimated 150 tonnes, valued at $8.5 billion worth of gold, is expected to be shipped to China by the end of May.
Since February 2020, when COVID-19 began surfacing globally, China had only been purchasing 10 tonnes of gold a month, valued at $600 million.
Nearly a 15x increase of gold purchases in just one year.
In March, India’s gold imports jumped to nearly 471% from the previous year to set a new country record.
The country purchased a total of 321 tonnes in the March quarter compared to 124 tonnes a year ago.
A nation that didn’t seem to be moved at all by gold’s pullback in price from its all-time high.
In fact, according to one source, it seems like the nation was hoping for a price decline.
Harshad Ajmera, a wholesaler in the city of Kolkata said, “many consumers had postponed buying due to higher prices. They rushed to buy after prices corrected sharply.”
Even the central bank of Hungary gained some attention with its recent gold purchase.
They just made one of the most significant purchases by a central bank in decades by tripling its gold reserves.
These countries, and many others, are solely focused on acquiring as much as they can.
The ramp-up of gold purchases globally leads many to believe that a new floor or support level for the current price of gold has just been set.
An analyst at Standard Chartered, Suki Cooper, recently commented, “Their recovery is critical in setting the floor for gold and should stop prices from falling further over the coming months.”
Not only are Americans questioning the future of the dollar, but now, countries all across the world are too.
Do you think the massive money printing is strengthening or weakening the dollar?