The NBP's investment in gold was followed by safety considerations," stressed deputy president Marta Kightley in an interview with PAP. The monetary strategy of PKO BP Mirosław Budzicki assessed that the purchases of gold by the central bank were besides "a very good investment shot".
In October, the National Bank of Poland purchased 240 1000 ounces of gold and as a consequence at the end of this period it held 13,734 million ounces of this gold worth over PLN 152,9 billion, or almost EUR 35,13 billion. This year the NBP bought over 2.2 million ounces of gold. This is most likely not the end, due to the fact that the president of NBP, Adam Glapiński, informed that the central bank's management had decided that gold should account for about 20% of Poland's abroad reserves, whereas it is presently little than 18%.
– 20 percent gold is specified a benchmark. Large EU countries keep a akin level – said PAP and vice president of NBP Marta Kightley. She besides added that a advanced level of reserves, including gold reserves, supports assurance in a given economy. She felt that this was peculiarly crucial in the context of an increase in geopolitical risk. She besides said that erstwhile deciding to increase the gold reserves, the central bank is guided by a policy that emphasizes the safety of these measures. She indicated that the gold “is safe”.
– It can be seen, for example, that as geopolitical tensions rise, the price of gold rises. In addition, we strive to have abroad exchange reserves diversified and to buy gold is 1 way to diversify our reserves. Our main reserve currency is simply a dollar, and in rule we are dealing with a situation where erstwhile a dollar weakens, it costs more gold, and erstwhile a dollar costs more, it costs little gold. Although this dependence has not been seen recently, historically, it balances well. Of course, we effort to make the reserves besides bring back returns. The increase in the valuation of gold in turn increases bank capital said Marta Kightley.
However, there are opinions that by investing in the NBP gold it reduces the possible for growth in the profit of the central bank in the future. For example, in the case of gold, the profit comes solely from valuation, while bonds besides supply interest income.
– Indeed, investing in gold does not give interest. It is possible to borrow gold, it gives any gross (gold lease rate – GLR), but mostly the investor expects profits from the valuation itself. And this valuation works for the central bank. That was a very good shot, the price of gold went up hard. Of course, the gold may melt, but so far the score is very good. Besides, we inactive have a pro-inflational environment, and this allows us to presume that prices of natural materials will increase. So besides gold. said PAP financial marketplace strategy PKO Mirosław Budzicki.
However, he added that the rules for investing abroad reserves are different from the objectives pursued by, for example, funds or banks. The central banks consider another factors.
– The central bank invests in terms of security, but besides in specified a way as to be prepared for events specified as wars, cataclysms, epidemics. And erstwhile specified threats occur, the price of gold usually increases expanding the value of the accumulated reserves precisely erstwhile they are needed. In addition, as we look at the valuation of gold in the long term, it turns out that it brought a akin return to US treasury bonds said the economist PKO BP. He added that the NBP is not the only 1 buying gold. This trend is besides seen among another central banks.
– Russian assets have late been blocked due to Russia's attack on Ukraine. This created a precedent and the people who are liable for investing central bank funds in the world, this precedent has been seen. It turned out that access to financial assets could be blocked, but that access to gold was no longer – that was the case with Russia said PKO BP strategist.
Currently, the price of gold per ounce is about $2.7 thousand. Over the last 10 years, the price of gold has risen by $1.5,000 an ounce, so more than doubled. In the last 3 years, that is, during the period of Russia's attack on Ukraine and the war between these countries, the price of gold has risen by almost $1,000 per ounce, or about 50 percent.
Source: PAP / Marek Siudaj
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