Banks make a dash for gold

The dash for gold suggest banks are more worried about the effects of quantitative easing than they let on, says Andrew Van Sickle.

Are central bankers more worried than they let on about how this great monetary experiment of quantitative easing and negative interest rates might end? According to a new study by the Official Monetary and Financial Institutions Forum (OMFIF), central banks have added more than 2,800 tonnes of bullion almost a tenth of global total demand to their reserves since 2008, reflecting gold's "renewed attractiveness as a safe-haven asset", say OMFIF's David Marsh and BenRobinson.

Central banks in developed countries have kept their reserves steady, while their emerging-market counterparts have been building them up. The past eight years have seen the longest continuous spell of gold buying by central banks since 1950-65. Then, finance ministries and central banks piled up more than 7,000 tonnes as they strengthened their economic systems after the world war. Between 1970 and 2008, however, banks had run down theirstocks.

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Andrew Van Sickle
Editor, MoneyWeek

Andrew is the editor of MoneyWeek magazine. He grew up in Vienna and studied at the University of St Andrews, where he gained a first-class MA in geography & international relations.

After graduating he began to contribute to the foreign page of The Week and soon afterwards joined MoneyWeek at its inception in October 2000. He helped Merryn Somerset Webb establish it as Britain’s best-selling financial magazine, contributing to every section of the publication and specialising in macroeconomics and stockmarkets, before going part-time.

His freelance projects have included a 2009 relaunch of The Pharma Letter, where he covered corporate news and political developments in the German pharmaceuticals market for two years, and a multiyear stint as deputy editor of the Barclays account at Redwood, a marketing agency.

Andrew has been editing MoneyWeek since 2018, and continues to specialise in investment and news in German-speaking countries owing to his fluent command of the language.