After Hungary and Poland, Serbia has also recently added gold to its reserves. On the recommendation by President Aleksandar Vucic, the central bank bought 9 tons of gold in October. As a result, the country’s total gold stock rose to 30.4 tonnes, about 10% of total reserves. For years, the central bank has added gold to its reserves, but they never purchased this much in one month. It also has plans to further diversify its currency reserves towards euros.
The Governor of the Serbian central bank, Jorgovanka Tabakovic, announced the purchase on Thursday. “We have completed the gold purchase and that makes Serbia safer today with 30.4 tons of gold, worth about €1.3 billion. At the moment we have no plans to buy more”. The central bank paid €395 million for the precious metal. This equals a gold price of €1,367 per troy ounce and €43,950 per kilo.
European countries buy gold
More European countries have bought gold in recent years. Poland started buying gold over a year ago, to double its gold reserves to 228 tonnes earlier this year. In the spring of 2018 Hungary repatriated its gold stock of just over 3 tonnes to expand reserves to 31.5 tons just a few months later. With the purchase of 9 tonnes, Serbia is the third Eastern European country to increase its gold holdings.
Several countries are repatriating their gold reserves due to increasing economic and geopolitical uncertainty. The precious metal is seen by central banks as the safest reserve, because it has no counterparty risk. This argument only applies if the precious metal is actually stored at the own central bank. For this reason, more countries are retrieving their gold reserves stored in London and New York.
In recent years, Germany, the Netherlands and Austria, among others, have repatriated some of their gold. Earlier this year, there were also rumors in Romania about repatriating the national gold hoard. We will continue to follow this trend closely.
Serbia adds 9 tonnes to gold reserves