For the 21st straight month, central banks around the world having been buying physical gold as a way to protect their currencies, and create monetary reserves that are not based on dollar assets.
The rush to replace dollars has become a high priority, especially for emerging nations, as the reserve currency loses much of its luster. In fact, since the beginning of the year foreigners have dumped $123 billion in U.S. Treasuries which is the largest amount in the first three months of a year since 1978.
Led by Russia, central banks remained strong buyers of gold in the first quarter of the year purchasing 109 tonnes. This represents the 21st consecutive quarter that central banks have been net purchasers of gold as they continue to diversify away from the US dollar according to the latest World Gold Council report.
Despite the steady buying most developing countries still hold less than 10% of their reserves in gold, compared to 60% or more in places like the US, Germany and Greece. The much higher share in developed economies is mainly a legacy of the Gold Standard, but but even the European Central Bank, established long after the introduction of fiat currencies, holds more than 25% of its reserves in gold. - Mining.com