9.4
7.525 Reviews
English
EN
Turkey has been adding gold to its reserves at a rapid pace in recent years added. Since 2016, the central bank has bought almost 300 tonnes of gold, as the stock rose from 116 tonnes to 415 tonnes during this period. Especially in recent months, Turkey bought a lot of precious metals, with a record purchase of 41.8 tonnes in the month of August. In fact, in the third quarter of 2019, Turkey was the largest buyer with 71.4 tonnes, more than Russia and China in the same period.
According to the figures of the World Gold Council Turkey's central bank now holds 19.9% of its reserves in the form of gold. That's comparable to the percentage of gold Russia holds. At the current gold rate, Turkey's gold reserves represent a value of more than $20 billion. In addition, according to Figures of the central bank on a foreign exchange reserve of $76 billion.
Turkey has been buying gold on a large scale since 2017 (Source: World Gold Council)
Turkey's central bank has been structurally adding gold to its reserves since May 2017 by buying it on the open market. Since then, the World Gold Council has distinguished between gold from the Turkish central bank and gold it manages for commercial banks. For 2017, these figures were added together, which gave a distorted picture of the actual gold supply.
With the purchase of gold, Turkey is following the example of countries such as Russia and China. These countries have also added precious metals to their reserves on a large scale in recent years. Last year, central banks collectively bought a record amount of gold, including a large number of Asian countries.
Central banks buy gold to diversify their reserves. Unlike foreign exchange reserves, the precious metal has no counterparty risk. It is also a tool that countries being able to fall back on in times of crisis. In a world of increasing geopolitical tensions and economic warfare, these traits are becoming increasingly important.
This contribution was made from Geotrendlines
