Gold Demand up 42%, Countries Abandon US Dollar Amidst Geopolitical Shift

Central banks around the world are turning to gold as an alternative to the US dollar, which they see as being undermined by America’s aggressive trade policy and geopolitical uncertainty.

Demand for gold was up 42 percent year on year in the first quarter of 2018 among central banks, the World Gold Council (WGC) statistics say. Russia and Turkey are the largest net buyers.

Central banks added a net total of 193.3 tons of bullion in the half of 2018, an 8 percent increase from the 178.6 tons bought in the same period last year. This marks the strongest six months for central bank gold buying since 2015, the WGC notes.

As of the first half of 2018 central banks increased their gold holdings to $1.36 trillion, around 10 percent of global foreign exchange reserves, the WGC said. An analyst has told RT that the reason behind the move is a wish to diversify from the greenback.

“The United States has long used the dollar to put pressure on competitors. This has always caused anger in the world community. And now the fight against the dollar has reached Europe,” said Eldiyar Muratov, President at Singapore Castle Family Office.

“Russia has stepped up buying gold in its reserves in the face of new US sanctions and a possible disconnection from the dollar system,” added the analyst.

According to Muratov, a similar strategy is now being observed in many countries in Europe and Asia. China, Turkey, Venezuela, Iran, Qatar and Indonesia, are aimed at de-dollarization of economies and foreign trade. All these countries are significantly increasing their gold reserves, the expert says.

As the WGC notes in its report, gold buying is not only about hedging currency risks. “In an environment of heightened geopolitical tensions, gold is an attractive asset because it is not anyone else’s liability and does not carry any counterparty risk,” the report says.

“Gold is already a familiar asset class for central banks, but the changing nature of the gold market – with ever-growing consumption coming from developing economies – means that gold is increasingly aligned with emerging market economic patterns. Central banks may increasingly recognize that the rules of the game are changing.”

Emerging economies stockpiling gold in expectation of US dollar banking system collapse

Countries around the world are turning to gold as uncertainty about the global economy rises. Trade wars and the aggressive policies of the United States are making emerging economies withdraw from dollar assets, analysts told RT.

“In the near future we can witness a big change in the rules of the game. At the beginning of the year, developing countries were the first to feel investor panic. If a crisis in Latin America and South Asia doesn’t surprise anybody, now is the time to worry about the largest economies of the world,” Mikhail Mashchenko, an analyst at the social network for investors eToro in Russia and CIS told RT.

“The aggressive US policy in recent years has forced some countries to look for an alternative to the dollar and replenish their gold reserves. Worries about the future growth of global economy are an additional incentive for purchases. Many question Donald Trump’s protectionism,” the analyst added.

There are signs that the global financial system dominated by the US dollar could collapse, says financial institute FinIst analyst Denis Lisitsyn. These signs include the uncontrolled emission of money from different countries, an increase in US interest rates, trade wars, the rapid rise in energy prices, geopolitical tensions in Syria, Iraq, the war in Yemen, he says.

“Many countries are buying gold in advance. They understand that paper money is constantly eaten up by inflation, equities will sharply fall in price in case of a crisis, and foreign deposits can be arrested, confiscated or frozen,” he said.

Hungary, Poland, Russia, China, India, Turkey, Saudi Arabia are all hoarding gold, notes Vladimir Rozhankovsky, LIFA, expert at the International Financial Center.

“There are few alternatives to the US Treasury bonds in terms of volumes and market liquidity, but more prudent countries want to boost their reserves. Gold is, in fact, the only alternative. Even for those who do not believe in it,” he said.

Under such conditions, many central banks view gold as a traditional safe haven that allows them to ensure against possible turbulence in the markets, says Mark Goihman, leading analyst at TeleTrade. “After all, gold usually grows in price during periods of crises, and it can serve as additional support for the national currency. Many countries, in particular, China and Russia, turn to gold in opposition to dependence from the domination of the dollar. They are reducing dollar assets in their reserves,” he said.

Not only China and Russia are into gold, notes FinIst’s Lisitsyn. Germany has repatriated more than 300 tons of gold, and the Netherlands returned about 100 tons of bullion. Turkey bought 187 tons of gold last year, and has repatriated gold from the US Federal Reserve.

Iran also used gold to stabilize their economy. “Iran was forced to switch to gold payments. Weak economy and soaring inflation forced Tehran to throw gold money into the domestic market. After that, the economy stabilized, and the currency strengthened,” Lisitsyn said.

“Many neighboring countries, such as Turkey, also benefited from gold settlements with Iran. Turkey got a positive trade balance and saw the lira stabilize,” he concluded.

Interestingly, Trump has a contrasting idea about the dollar…

“I had a great meeting with Vladimir Putin, great meeting. I talked about everything, we will do great. And don’t forget — Russia wants our help economically. We have created such wealth. I have done a really good job – $11.7 trillion. Russia wants us to be involved. Everybody wants our help,” Trump said at a rally in the US state of Illinois.

19 thoughts on “Gold Demand up 42%, Countries Abandon US Dollar Amidst Geopolitical Shift”

  1. Already to go, EVERYONE votes Common Sense party line PRINTED on bottom Print names you wish to vote for in Row starting above Common Sense party, also in empty row PRINT ballot initiative example END FED print yes in that row on Common Sense part line. this is VALID BALLOT every one must be put in special bag and HAND COUNTED and they do NOT get counted as REPUBs or Dems.

  2. China Will Not Attack The Dollar Directly, But Is Surrounding It For Death Knell…

    US allies would then need to choose between the two: the collapsing dollar, with no backing to shore it up, or a Gold-backed renminbi.

    Many countries outside the US see the US approach to diplomacy as: Bluster and Intimidate.
    Whilst, typically, US diplomats wear suits and appear businesslike in their manner, their message is often considerably different. If the US states what it wants from another country and that country then chooses to decline, the response by the US is often an “in your face” approach not unlike that associated with the image of a wild-West sheriff.

    The message received from the US is often along the lines of, “We’ve decided what your role in the world should be, so get with the program or you’ll feel our boot on your neck.”

    It should be said that it makes no difference to the country on the receiving end whether it is a left boot or a right boot; whether the current US president is a democrat or republican is of no consequence. The country feels the boot equally, whichever party is in power. And the message and the objectives remain the same, regardless of which party is presently in control.

    As offensive and reprehensible as this approach is, the countries of the world often simply cave in to such behavior. They understand that if a country’s leader were to decide to, say, cease to trade in US dollars, his country might be attacked for trumped-up reasons and the leader could end up in a pine box. (This approach has been employed on more than one occasion in recent years.)

    The threat from the US is therefore very real.

    But presumably, this bullying approach would be less effective if attempted against one of the world’s more powerful countries. If, for example, the US were to find itself in a situation such as the present one with China, in which the US appeared to be losing its battle over the dollar’s power as the world’s reserve currency, what would occur? Would the US attempt to bully China? And if the ploy failed, would the US draw its six-guns and fire off a few rounds in the air for emphasis?

    And if the above were to take place, what would the Chinese reaction be? Would they retaliate in a similar manner—the diplomatic equivalent of an American baseball player butting chests with an umpire—each one childishly seeking to win through sheer bluster?

    Here, it would be useful to consider Chinese culture. Traditionally, bluster and braggadocio are not consistent with Chinese behavior. The Chinese tend to take a quieter, more thoughtful approach, one that employs patience and careful timing.

    It might be useful to consider the traditional game of Wéiqí (aka Go), a board game that was first played in China thousands of years ago and is still popular to this day.

    In Wéiqí, the objective is to place the playing pieces on the board one at a time, in an effort to surround the pieces of the opponent. (Once the pieces are surrounded, they are considered taken.) Of interest is that a common tactic is to avoid being obvious in the effort to surround the opponent’s pieces. The greater the subtlety of play, the greater the likelihood of eventual success. In essence, the philosophy is the exact opposite of the US approach. It is one of surrounding the opponent, rather than meeting him head-on.

    The game of Wéiqí is of greater significance in China than, say, Monopoly is in the US. It contains a philosophy that is basic in Chinese thinking. Although this is not a game that is likely to become popular in Las Vegas, it is one that informs Chinese diplomacy.

    Aside from the occasional comment from the Xinhua News Agency suggesting building a “de-Americanized world,” the Chinese have generally kept their cards close to their vest.

    Returning to the question of the dominant currency in the world, the US is unquestionably following its wild-West sheriff approach in demanding that the dollar remain the world’s default currency: taking military action against those who move in another direction.

    Meanwhile, the Chinese have been quietly expanding the power of the renminbi, first by encouraging its use internationally, then working out currency agreements with the BRICS, ASEAN, etc. More recently, they have created agreements with Western countries like Australia and the UK to trade in the renminbi.

    As in a game of Wéiqí, China is not attacking the dollar directly. They are surrounding it, by creating relationships first with their own close allies, then with the US allies. If they continue in this tactic, it is likely that they will complete their ability to trade with all or most of the world in the renminbi, then announce to the US that, in order to continue to buy Chinese sneakers to sell in Walmart, the renminbi must be used.

    At that point, should the US refuse, China would be in a position to say, “You’re an important customer, but if we lose you as a customer, we will still be able to maintain our present relationship with the rest of the world without you.”

    The question would then be whether the US need for Chinese goods is greater than the Chinese need to sell them those goods. There can be no doubt that both countries want the relationship to continue; however, the one who could hold out the longest would be the victor—in essence, a game of economic “chicken.”

    At such a point, the US would be likely to appeal to its allies to step in and side with them. But if the event were timed by the Chinese to coincide with massive inflation of the US dollar, the US allies would then need to choose between the two: the collapsing dollar, with no backing to shore it up, or a gold-backed renminbi.

  3. Geee…I was wondering, What ever happened with Julian’s promise to announcement about exposing the Clinton’s crimes IF the Trump’s Didn’t???
    He gave them up to the 21st of THIS month…Its now the 27th…SIX DAYS PAST DUE.

    1. We know the truth there Kenneth.
      The FBI claimed she was innocent – yeah right. Now they are investigating the ‘pipe bombing man’ whom they have now caught a suspect….. The so called top echelons of society are just so thick with deceit it is like walking through fog.
      Only the awakened will see and know this though. The other foragers will continue life with their heads down and eat the grass even if you showed them the truth – some just can’t see it.
      I spoke with a QC yesterday about being a ‘Free Man’. As long ago if a person did a very good deed then the mayor or king would bestow upon him a ‘Free Man of the City’, which mean’t that he could travel, eat etc anywhere in the said city for free and will not be charged for any of it. So I asked him that if the mayor granted him this privilege then that would mean that we are all prisoners to a system… He answered and said that it was all hogwash and this has no standing in court – according to wikipedia it has no standing and no judge has ever granted such a thing.
      However, it was ‘JUST MADE LIKE THAT’ and it would appear that many are above the ‘law’, because of their satanic worship.
      Man needs to wake up.

      1. You cannot expect “Justice” from a system that should read more a JUST-US system which views it’s Citizens as SLAVES, who have no Rights what so ever…That’s Why Voting is such a Joke any more.

      2. @Shapliemau
        You mean Man-KIND right??? Because HU-Manity/Wo-Manity, or “Melanin Beings” were NEVER ASLEEP…Just in Hibernation until the RIGHT moment.

  4. And who has already ‘bought’ this gold with the fake money? This whole trip regarding money is one of greed, power and symbolism – everything that does not make man complete. In fact leading man down the wrong path continually. Everything that is so called established by man is a lie.

    It is overdue for change and this we must do ourselves.

  5. Trump said ”Everyone wants our help”

    LOL These zionist’s puppets will say anything thy are told to..
    The XACT opposite is happening, NO ONE wants JooSA or their idea of ‘help’ to enslave their country and make it a JooGulag…

  6. How come the market value of Gold has not gone-up despite the “42%” increase in demand? Such claims of increase in demand do not make sense, so what gives?

    [Or, is it the fact , like in the early 90’s with Enron, that ‘old gold’ (stolen) is still being secreted into the system?]

    The Chinese bias comes through too, along with its concomitant misrepresentations, especially about ‘passiveness’ – I can’t see anyone considering the Spratly Island operation as anything but expansionist empire building, and not an example of acting passively.

    The Communist Government has misrepresented history repeatedly, and these claims were amply exposed in The Australian weekend review in late April this year.

    1. Benard, the actual ‘market value’ of Gold and Silver is being manipulated by the Masonic Zionists Santanists. Why does silver not also going up? It’s actually falling. I once traded on the market, but got out when I realized you can never really “hold” a position on ANY commodity, From Gold and Silver to bacon or Soy Beans. You MUST exchange that position at some point. It is amazing that the Masonic Zionists Sanatanists are getting away with this for so long. BRICS, ASEAN and others will bust the ILLEGAL US Fed and it will be coming sooner than we think. ALL countries are basing too much of their economies on making killing machines, rather developing economies of health care for citizens, and colonization of space by human population. #2020CydoniaRover will NEVER land in Cydonia, American “Space Force” are made of scientific cowards. The ONLY quadrant on Mars where for more than 45 years Map Legend stated: “Origins: Enigmatic” That was t, not even any single guesses. Will show you the infamous “Catbox” of the Ares Face on Mars. Which is still found on many NASA “scientific” sites as THE ‘Official’ face, where you can see a properly processed image showing helmet, two eyeballs, one tear, a nose ridge line ending in two nostrils and two properly placed lips above a slightly raised chin. Already with early voting on machines, people are reporting voting that the machine changed their votes…I took election oversight worker course and HAND Written ballots CANNOT be counted by machine but are put into BLUE bags that must be hand counted. Also one can add a ballot item like END FED , 2020CydoniaRover, VETS B4 Bullets, and printed in the row down near Common Sense party printed column you print YES, if everyone in America were to do this, this would be 1st HONEST election since 1776.

      1. In 2010 the price of silver increased three-fold, to around $45. By 2011 it was all gone, and back to its original level where it has stayed since then.

        Some say this was Soros manipulation, a very earthly force. Blaming the lot on un-provable extra-terrestial sources is simply not helpful, nor is it really credible.

        Of course the question I interposed relates to the gold market, not silver, meaning your reply is even more remote with respect to my stated concerns.

    2. The markets have always been manipulated. The gold and diamond price amongst others controlled by the UK. I to used to delve in the stock market and got out soon enough. Does anybody remember TATA Steel? It went bankrupt about 3 years ago, but to my amazement the share price never dropped??? It was bought for £1, yes one pound sterling and has never looked backed since…. So what gives? If people think that the stock exchange is not rigged there is loads more.

      1. You SAW first hand just how Crooked that system is with THAT experience (Laugh!)…That practice happens DAILY there.
        The stock market operate EXACTLY like the bankers do, only they call Their version “Futures” (Hyperthedical FUTURE Value???
        Smells just like “Fractional Reserve Banking” (Get-It?)
        Just plain FRAUD on a daily basis…Yeah I learned all about the markets when I used to believe in them.
        Once I leaned that THEY are exactly as crooked as the bankers…I GOT-OUT long ago.

  7. FOLKS!…Its really VERY Simple about WHY this financial mess exist (RING-RING…ANYBODY HOME?!)
    Can’t ANYONE Smell the DIFFERENCE between a REAL apple and the ROAD one?????????????????????

  8. Bankrupt corporate vehicles and entities are excellent shells for money laundering activity. Watch ’em real close. Real close.

    Check-out Enron’s exposure to paper gold, and Barrick Gold in that context. Enron went down post 911, as part getting rid of all the evidence of the money/ stolen gold laundering operation on the twin towers. FBI operation El Dorado, eh?

  9. GEEPERS Bernard…You just “Touched” on WHY ENRON was created, because ENRON was really about Absolute control of ENERGY…REMEMBER???
    Yes IT was used to BUY-OUT the ENTIRE Government of “IN-Corporated” USA…to the tune of somewhere between $200,000,000.oo to $300,000,000.oo bucks APIECE deposited in SECRET bank accounts WORLD WIDE.
    The Bankoholic’s believe that to control ALL ENERGY (and DEBT/CREDIT)…is to CONTROL EVERYTHING…UNDERSTAND???
    Ya see Bernard…THEY were Hoping to get away with These “Crimes against Humanity THEIR Usual way…WAR…Only this time it was a “Terrorist Attack” carried out by largely OUT OWN GOVERNMENT…That they said WOULD NEVER END IN A LIFETIME??? REMEMBER???


    1. Love reading the comments, and articles.
      Canada sold of it’s gold, why I will never understand, yes we have it in the ground but knowing what they know, you have see it that they want to gut Canada.

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