Amid the BRICS alliance de-dollarization plans, Central Banks across the globe have recorded record gold buying as a clear US dollar defense. Indeed, the World Coin Council reported that 2023 saw a record 374.1 tons of gold being purchased by various central banks. Moreover, the reason seems tied to the geopolitical sentiment toward the greenback.
The purchasing of gold coincides with the increase of foreign exchange reserves by many Central Banks. Subsequently, these countries have opted to begin diversifying their economic footprint. Specifically, as the global perspective shifts away from the US dollar. Moreover, it is starting to embrace the multipolarity that the BRICS bloc has been advocating for.
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BRICS Bloc Influence Seen as Gold Buys INform De-Dollarization
Throughout the last year, the BRICS economic alliance has spearheaded efforts to lessen international reliance on the US dollar. Indeed, its now 10 country members have opted to increase local currency usage. Now, various countries appear to be following suit, while stock-piling one specific asset.
Amid the BRICS de-dollarization initiatives, various central banks have opted for record gold buying throughout 2023 as a clear defense against the US Dollar. Specifically, the acquisitions have coincided with greater economic diversification as a global theme throughout the year. Ultimately, pointing to the lessening status of the greenback on an international basis.
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Among the central banks opting for greater gold holdings, Russia and China lead the way. Specifically, Russia called for an increase in gold as a key part of its Fiscal Fortress policy. Although other countries are not facing the sanctions Russia is, the point of the acquisition remains. Diversification, amid the ongoing uncertainty of the United States economic reality, is a near necessity.
Integration has continued to be a crucial part of global economics in the modern world. As local currency usage continues to grow, they will begin to increase in foreign holdings across central banks. Moreover, the potential arrival of a BRICS currency should also be sought after by various nations. If only just as another hedge for the growing uncertainty facing the international dominance of the US dollar.