According to a report released by the World Gold Council this month, the United States once again leads the global gold reserves ranking in the first quarter of 2024 with a reserve of over 8,100 tons. Taiwan has entered the top 15 countries globally in terms of gold reserves.
Gold reserves are crucial for a country’s economic stability. They serve as a reliable store of value, especially during times of financial uncertainty.
The increasing economic uncertainty worldwide has led to a continued rise in demand for gold reserves by central banks. The World Gold Council stated that central banks around the world continued to significantly increase their purchases of gold in the first quarter of 2024. Demand for gold bars and coins remained strong. Including a significant amount of over-the-counter (OTC) trading by investors, total gold demand increased by 3% year-on-year, reaching 1,238 tons, making it the strongest first quarter since 2016.
The World Gold Council also revealed the latest ranking of global gold reserves for the first quarter of 2024. While the United States and European countries dominate the top 10 countries with the largest gold reserves, three Asian countries also made it to the top 10 – China, Japan, and India.
Taiwan has entered the top 15 countries, ranking 12th on the list with 422.38 tons of gold reserves valued at 28.225 billion US dollars.
Notably, the United States, as the top-ranked country, possesses a gold reserve almost equivalent to the combined reserves of Germany (ranking second), Italy (ranking third), and France (ranking fourth).
India also holds a significant position in global gold reserves, ranking ninth in the latest list. India has a deep cultural affinity for gold and a historical tradition of using gold as a store of value, contributing to its economic stability and playing a crucial role in the country’s financial landscape.
Here is a list of the top 10 countries and regions with the highest gold reserves, along with their corresponding gold reserve amounts and values:
1. United States: Gold Reserves: 8,133.46 tons, Reserve Value: 5790.50 billion US dollars
2. Germany: Gold Reserves: 3,352.31 tons, Reserve Value: 2,386.63 billion US dollars
3. Italy: Gold Reserves: 2,436.91 tons, Reserve Value: 1,745.55 billion US dollars
4. France: Gold Reserves: 2,436.88 tons, Reserve Value: 1,734.92 billion US dollars
5. Russia: Gold Reserves: 2,332.74 tons, Reserve Value: 1,660.76 billion US dollars
6. China: Gold Reserves: 2,262.45 tons, Reserve Value: 1,610.72 billion US dollars
7. Switzerland: Gold Reserves: 1,040.00 tons, Reserve Value: 694.95 billion US dollars
8. Japan: Gold Reserves: 845.97 tons, Reserve Value: 602.28 billion US dollars
9. India: Gold Reserves: 822.09 tons, Reserve Value: 585.27 billion US dollars
10. Netherlands: Gold Reserves: 612.45 tons, Reserve Value: 436.03 billion US dollars
The economies ranking 11th to 20th respectively are Turkey, Taiwan, Portugal, Poland, Uzbekistan, Saudi Arabia, Kazakhstan, United Kingdom, Lebanon, and Spain.
According to Forbes India, countries hold gold reserves for several reasons:
First, gold is considered a stable and reliable store of value. By holding gold, countries can instill confidence in their economic stability, especially during periods of financial instability.
Second, gold has historically supported a country’s currency value. While the gold standard is no longer widely used, some countries still view gold reserves as a means to maintain currency stability.
Diversification is another key reason for holding gold reserves. Gold is a tangible asset; by holding gold in reserves, countries can diversify their overall investment portfolios. This diversification helps reduce risks associated with fluctuations in the value of other assets.
The strengthened inverse correlation between gold and the US dollar enhances the attractiveness of gold. When the US dollar depreciates, the value of gold often appreciates. This dynamic variation allows central banks to protect their reserves during market turbulence.
Gold reserves also play a role in international trade and finance. Some countries use gold to address trade imbalances or as collateral for loans. The presence of gold reserves can enhance a country’s credibility and influence its position in the global economic system.
Lastly, gold serves as a hedge during crises. In times of economic recession or geopolitical uncertainty, the value of gold tends to rise, providing a safeguard against inflation and currency devaluation.