Reports are rife that the BRICS alliance is working on creating a new currency to settle global trade that could be backed by gold. BRICS members China, Russia, and India are accumulating gold on a large scale in FY 22–23 and FY 23–24. China purchased 21 tonnes of gold to its reserves in June 2023. Moreover, the Central Banks of the BRICS countries are the top buyers of gold this year, indicating that the alliance could be using the precious metal as backing for a new currency.
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Andy Schectman, President of Miles Franklin, told Kitco News that there are chances of the BRICS launching a new currency backed by gold. Even if gold is not used as backing, the alliance could work towards the formation of a new currency. “I do believe that BRICS will issue a common settlement currency, and it will be backed by something,” he said.
Schectman stressed that a BRICS currency is inevitable and could be launched in a few months or years. “It’s coming. Whether or not it is a gold-backed currency that is introduced in a few weeks or a few months, or next year,” he said.
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He called the new currency could represent a larger section of the global population as they begin to ditch the U.S. dollar. “To me, the alliance that is being built represents the majority of the human population,” said Schectman.
BRICS: Gold-Backed Currency Talks At the Summit?
South Africa’s BRICS Ambassador Anil Sooklal recently revealed that BRICS will not discuss the formation of a new currency. “There’s never been talk of a BRICS currency, it’s not on the agenda. What we have said and continue to deepen is trading in local currencies and settlement in local currencies.”
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Sooklal also exclusively said to Watcher Guru that the alliance will discuss trading in local currencies at the summit. “Discussion focuses on deepening use of local currencies,” he said. BRICS is an acronym for Brazil, Russia, India, China, and South Africa. The upcoming summit will be held on August 22 to 24 in Johannesburg.