The largest country in the world in terms of gold reserves in the US military camp, the US, has 8133 tons of gold reserves, which is said to be worth $628 billion. The United States’ gold reserves are stored in the United States Bullion Depository, commonly known as Fort Knox.
This treasure is located in the US state of Kentucky and is actually inside a US military base. Here, 4,581.5 tons of US Treasury gold in the form of bars and bricks are stored in the basement. Hundreds of US soldiers, military police, and specialized security forces are assigned to monitor Fort Knox 24 hours a day, seven days a week. In addition, there are layers of security fences around this building.
Sensors that capture any moving object are installed. Alarms and security cameras are installed separately. Although many films have been depicted here, there has never been a robbery in the real sense.
Turkey: The World’s Largest Buyer of Gold
A large portion of the gold currently available around the world is held in central banks in various countries. These gold reserves are held for their capital security, liquidity, and yield characteristics. One-fifth of all gold ever mined is held in central bank vaults. During the first six months of 2024, central banks around the world purchased 483 tons of gold, a new record.
Turkey was the largest buyer of gold in the first six months of the year, with 45 tons. India was the second largest buyer, buying a total of 37 tons in the first half of this year. Although China is traditionally the largest buyer of gold, its interest in buying gold has declined in recent times. China did not make any significant purchases of gold in May and June this year. Earlier, China’s central bank had been increasing its gold reserves for 18 consecutive months.
Reasons for the Increase in Reserves
The growing geopolitical tensions, economic sanctions, and the growing trend of decoupling from the US dollar, which has led to a surge in interest in buying gold around the world. In the past decade, between 2013 and 2023, central banks of various countries, especially Russia and China, have increased their reserves by buying gold at a very rapid pace.
One reason for this is the de-dollarization, and the other important reason is that gold reserves are considered safe, easily convertible into cash, and profitable. Due to these same characteristics, Russia’s gold reserves, which were 1035 tons in 2013, increased to 2333 tons in 2023. Thus, Russia increased its reserves by 1298 tons of gold in 10 years.
China’s gold reserves were 1054 tons in 2013, which increased to 2235 tons in 2023. Which was 1181 tons more than before. Similarly, in the last ten years, Turkey increased its reserves by 424 tons, Poland by 256 tons, India by 246 tons, Uzbekistan by 154 tons, Kazakhstan by 151 tons, Singapore by 103 tons, Iraq by 100 tons, and Thailand by 92 tons.
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Why Do Countries Store Gold?
Most countries in the world hold gold reserves for various reasons. First of all, gold is considered a stable and reliable value in financial terms. By storing gold, countries build confidence in their economic stability. Especially at a time when there is an atmosphere of financial uncertainty in other parts of the world. In addition, historically, gold has played an important role in determining the value of any country’s currency.
From the late 1800s to most of the 1900s, the value of paper currencies of countries was determined according to a specific amount of gold, and any country could print currency notes according to the amount of gold, while the same amount of gold could be obtained in exchange for currency notes.
However, although the gold standard is no longer used in most countries to determine the value of their currency, some countries still consider gold reserves as a means of keeping their currency stable. Another important reason for holding gold reserves is its size and diversification. Gold is a real, tangible, tangible asset. Countries that hold its reserves can convert their investment shares, etc. into different forms.
Due to this diversified feature of gold, the risk of fluctuations in the value of other assets is reduced. The demand for gold also increases due to its inverse relationship with the US dollar. When the value of the dollar falls, the value of gold increases. Due to this trend, central banks focus on preserving their assets in the form of gold reserves during times of turmoil in global markets.
Gold reserves also play a role in international trade and finance. Some countries use gold to correct trade imbalances or use it as a means of obtaining loans. If a country has a good gold reserve, it is considered reliable and eligible to borrow and its reputation in the global economic system is also considered better. In addition, gold is also considered a hedge against losses during crises.
Its value increases in times of economic crisis or geopolitical uncertainty, and gold holders benefit when the value of currencies and currencies declines.