The role of gold in central bank reserves

LBMA/James Steele/July 2023

“Every independent central bank in the world holds at least some amount of bullion. Gold’s status as a currency is therefore borne out by the fact that bullion is counted as part of a central bank’s foreign exchange reserves. It is the only commodity-currency to have survived as money into the electronic age. This implies gold’s unique monetary status.”

USAGOLD note: Steele provides historical background on gold’s role as a central bank reserve asset and offers seven monetary functions that encourage it. All seven have to do with gold’s status as the ultimate store of value and final means of payment.