Contact us
CALL US NOW 1-888-GOLD-160
(1-888-465-3160)

Hungary Increases Gold Reserves 10-Fold

  by    0   0

Yesterday, the Hungarian central bank announced it recently boosted its gold reserves 10-fold.

According to its website, the National Bank of Hungary (MNB) now owns 31.5 tons of gold, up from 3.1 tons. It was the first significant purchase of gold by Hungary since 1986.

A statement by the bank said the increase in gold stocks was intended to increase financial stability and strengthen market confidence. 

In keeping with the historical role of gold, it remains one of the safest instruments in the world, which, even under normal market conditions, exposes its stability and confidence.”

The bank emphasized that stability goals drove its decision to buy gold, and it isn’t merely a short-term investment.

Gold also has a confidence-building effect in the normal period, that is, it can play a role in stabilizing and defending it not only in the extreme market environment, structural changes in the international financial system or in deeper geopolitical crises. Gold is still considered to be one of the safest assets that can be attributed to unique properties such as the finite supply of precious metal, which is not linked to credit and counterparty risk, since gold is not a claim against a specific partner or country.”

As GoldMoney head of research, Alastair Macleod, told qz.com, “gold is no one else’s liability.”

The National Bank of Hungary also brought its gold home. Last March, the central bank announced it planned to repatriate its existing gold holdings from London. According to the MNB, it completed the repatriation this month.

The role of gold reserves in the nation and economy strategy is becoming more and more appreciated while both the possession and the increase of the precious metals nationwide appear to be a decisive international trend.”

Hungary is the second Eastern European country to buy gold this year. The Polish central bank added about seven tons of gold to its reserves in July and another two tons in August, according to International Monetary fund data. It was the largest gold purchase by Poland since 1998.

A number of countries have been buying gold in recent months to diversify reserves and minimize their exposure to the US dollar. Central banks have bought a total of 264 tons of gold this year with Russia leading the way. According to the IMF, central bank purchases accounted for 10% of gold demand through the first half of 2018.

The Russian central bank added 26.1 tons of gold to its hoard in July alone.  Russian gold reserves increased 224 tons in 2017, marking the third consecutive year of plus-200 ton growth. In February, Russia passed China to become the world’s fifth-largest gold-holding country. (China has not officially added to its reserves since 2016, but many speculate the Chinese might secretly stockpiling the yellow metal as well.)

Kazakhstan and Turkey have also been big buyers. Other countries adding to their gold reserves include Egypt, Indonesia, the Kyrgyz Republic, Mongolia, the Philippines, Serbia, Surinam and Tajikistan.

World Gold Council managing director of central banks and public policy Natalie Dempster said countries may be buying gold with expectations that the global monetary system is shifting away from the US dollar. Last month, the EU announced it will create a special payment channel to circumvent US economic sanctions and facilitate trade with Iran.

We’ve been reporting on efforts by countries like Russia and China to limit their dependence on the US dollar and set up alternative systems outside of the global dollar system, along with the growing number of central banks buying gold as a way to diversify their holdings away from the greenback. The EU’s move to set up a new payment system indicates that even traditional American allies have grown weary of the US using the dollar as a weapon.

WhyBuyGoldNowBanner.070815.590

Get Peter Schiff’s most important Gold headlines once per week – click here – for a free subscription to his exclusive weekly email updates.
Interested in learning how to buy gold and buy silver?
Call 1-888-GOLD-160 and speak with a Precious Metals Specialist today!


Related Posts

US Stimmy Checks Support Foreign Manufacturing Economies

What do you get when you hand Americans big fat stimulus checks after decades of offshoring the country’s manufacturing economy? Massive trade deficits.

READ MORE →

Budget Deficit Surges to Record $1.7 Trillion in Just Six Months

The US government ran a budget deficit of $659.59 billion in March, pushing the budget shortfall to a record $1.7 trillion through the first half of fiscal 2021, according to the Treasury Department’s Monthy Treasury Statement. The March budget deficit ranks as the third biggest monthly shortfall in US history, driving Uncle Sam the biggest […]

READ MORE →

The Powerful Case for Silver: Free Updated and Revised Report

Silver enjoyed a brief moment in the limelight earlier this year when the so-called “Reddit Raiders” turned their attention to the white metal. The spotlight has dimmed somewhat, but there are still plenty of reasons to be bullish on silver. Our fully revised and updated The Powerful Case for Silver report provides an in-depth overview […]

READ MORE →

US Consumer Debt Spiked in February

Apparently, those stimulus checks weren’t enough. American consumers pulled out their credit cards and ran up big balances in February. According to the latest numbers from the Federal Reserve, consumer debt unexpectedly spiked in February, growing at an annual rate of 7.9%. Economists had expected a small uptick in consumer debt after a flat January, […]

READ MORE →

Central Banks Add Over 8 Tons of Gold to Reserves in February

Despite a significant selloff by Turkey, central banks globally added a net 8.8 tons of gold to their reserves in February, according to the latest data compiled by the World Gold Council. Gold-buying by central banks slowed last year from the record pace we saw in 2018 and 2019, and that trend has continued into […]

READ MORE →

Comments are closed.

Call Now