"Serbia's is among a growing number of central banks to hastily amass vast stockpiles of gold, upending decades of conventional economic logic and fuelling an increase in the gold price amid mounting geopolitical tensions. As Washington challenges the US Federal Reserve's independence, sending jitters through financial markets, the price soared to a record $4,643 (3,463) an ounce this week, and analysts have tipped it to break $5,000 this year."
"Although this partly reflects the soaring bullion price, experts say central banks are also stuffing their vaults as an insurance policy in a volatile world. Many are also rushing to repatriate gold stockpiles held overseas, and slashing their exposure to the US dollar. We have moved from Pax Americana to global discord, geopolitically. It is the law of the jungle when we see what the US are doing, says Raphael Gallardo, the chief economist at the asset manager Carmignac."
Central banks have been aggressively buying and repatriating gold, transforming decades-old reserve strategies and contributing to sharply higher bullion prices. Gold reached record levels, trading at $4,643 an ounce recently, with forecasts above $5,000 as geopolitical strains and doubts about US monetary credibility intensify. Officials and investors view gold as insurance against currency risk, potential confiscation of dollar assets, and erosion of the dollar's role as the global monetary anchor. Logistical challenges have emerged, illustrated by a shipment of Serbian gold left on a Swiss runway. Policy shifts include cutting dollar exposure and rebuilding domestic vaults for strategic security.
Read at www.theguardian.com
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