Gold Takes a Bigger Share
Gold is becoming a bigger part of global reserve assets. In recent years, its share has increased from around 16% to 27%. At the same time, the share of US Treasury holdings and other dollar reserves has slowly gone down.
This shows that many countries are changing the way they manage their reserves. Instead of depending mainly on the US dollar, they are adding more gold to their portfolios.
Who Is Buying Gold?
Many countries such as Poland, Kazakhstan, Brazil, China, and Turkey have been buying large amounts of gold. Along with them, a new buyer has also become very important. Tether, the company behind the USDT stablecoin, has built a huge reserve because it is widely used for moving money between the US dollar and cryptocurrencies. Part of these reserves is invested in gold and US Treasuries, making Tether one of the biggest buyers of gold in the market.
Trust Is Slowly Changing
The world is seeing more geopolitical tension than before. As trust between countries becomes weaker, trust in foreign currencies also gets affected. Because of this, many nations are trying to reduce their dependence on a single currency. Gold is seen as a safer reserve asset because it does not depend on the financial system of any one country.
A Slow Shift Away From the Dollar
The move away from the US dollar is not expected to happen overnight. It may take many years. However, more countries are now doing trade directly with each other using their own currencies. This gradual change suggests that gold could become the preferred reserve asset, while different currencies may continue to be used for daily international trade and business transactions.
Why Gold Demand May Stay Strong
Even if jewellery demand becomes weaker in some countries, gold prices may still remain supported. Central banks continue to increase their gold reserves, and investment demand is also growing. With global uncertainty staying high, many investors and institutions still see gold as a safe place to protect their wealth. Recent price corrections could be seen as an opportunity by long-term investors who believe this trend will continue.
