Wednesday, November 18, 2009

List of countries buying gold (or thinking of it)

There seems to be a pattern of emerging markets diversifying away from US$ reserves. I think this is showing that, with each passing day, the world (especially the emerging markets) is viewing gold more and more as a currency. More specifically, they are viewing gold more and more as a reserve currency (as both an alternative to the US$ reserve currency and to all paper currencies). This is a significant new development (not only from Central Banks and Governments buying gold to this scale, but it also sends a strong single to the traditional non-gold investment institutions to take a position in gold). I wouldn't be surprised if the list of countries continue to increase.

1) India - recently purchased 200 tonnes from IMF (about 7M ounces)

2) Sri Lanka - been buying for 5 to 6 months now

3) Mauritius (even tiny Mauritius) - bought 2 tonnes (almost 70K ounces) from IMF

4) Russia - Central Bank of Russia said they will buy all of the gold the Russian govt is interested in selling (if the govt decides to sell). It has been rumoured that the Russian govt would like to sell 27 tonnes of gold in order to raise funds towards balancing its budget.

5) Taiwan - Taiwan's central bank is studying whether to raise the amount of gold in its forex reserves

6) China - going through a similar exercise as Taiwan

7) South Korea - going through a similar exercise as Taiwan

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