Gold Reserve Fiat Currencies

The U.S. dollar has faced increasing scrutiny amid global monetary shifts. Historical data suggests global reserve currencies have shifted approximately every 100 years, while some studies indicate fiat currencies may have an average lifespan of around 27 years.

 The USD has been serving as a global reserve currency for over 90 years, 40 of which in a fiat-based system. While its status remains strong, some analysts have raised questions about the long-term sustainability of its dominant role.

Central Banks across the world are purchasing heavy amounts of gold.1 China and India, the world's two largest buyers of physical gold, are seeing increased demand.2 While gold typically shows a low correlation to other asset classes, recent purchasing trends by central banks have continued despite strong equity market performance. Central Banks, however, continue to buy gold at record levels.3

According to the World Gold Council, the National Bank of Poland increased its gold holdings by 25.7 tonnes in the second half of 2018, and a further 100 tonnes in the second quarter of 2019, which is the largest global single gold purchase of the last decade.

1. https://www.gold.org/goldhub/gold-focus/2021/06/central-bank-gold-buying-gathers-steam

2. https://www.reuters.com/business/energy/china-india-buying-adds-support-bullish-gold-narrative-russell-2021-05-27/

3. https://www.yahoo.com/now/central-banks-keep-buying-gold-195134503.html

4. https://www.gold.org/goldhub/gold-focus/2021/04/central-and-eastern-european-central-banks-significantly-expand-gold-reserves