Russia And Mexico Both Buy Nearly $1 Billion Worth of Gold in March
So far gold has not been a prime beneficiary of these risks but this will likely change soon – especially if financial conditions deteriorate which seems very likely.
Gold has recently displayed short term correlations with paper assets such as equities and bonds but these correlations will again be shown to be fleeting as gold’s long term inverse correlation with paper assets will reassert itself in the coming months.
Mexico, Russia and Central Banks Continue Diversifying into Gold
While gold demand from the western investors and store of wealth buyers has fallen in recent months, central bank demand continues to be very robust and this is providing strong support to gold above the $1,600/oz level.
IMF data released overnight shows that Mexico added 16.8 metric tons of gold valued at about $906.4 million to its reserves in March.
Russia continued to diversify its foreign exchange reserves and increased its gold reserves by about 16.5 tons according to a statement by its central bank on April 20.
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