BRICS was the biggest buyer of gold in 2023 as China, Russia, and India stockpiled the precious metal worth billions. The latest data from the World Gold Council shows that BRICS member China added 225 tonnes of gold to its reserves in 2023 alone. The gold buying spree from BRICS is spearheaded mostly by China while Russia comes second and India third. However, the gold accumulating frenzy from BRICS will continue in 2024 as the Central Banks of BRICS nations, mostly China and Russia have already started buying gold in January 2024.
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“On a year-to-date basis, central banks have bought an astonishing net 800t, 14% higher than the same period last year,” read the report from the World Gold Council.
Why Are BRICS Countries Aggressively Buying Gold Since Two Years?
Analysts claim that BRICS are stockpiling gold to guard their Central Bank reserves from an upcoming recession in the US. The upcoming US Presidential elections could impact the markets making countries to increase their gold reserves.
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BRICS wants to protect its reserves if the US dollar dips which creates a ripple effect to their native economies. Keeping it in reserves protects BRICS nations as the precious metal acts as a hedge against crashes and inflation.
Many others speculate that the bloc plans to back their soon-to-be-released currency with gold. The move will provide the alliance a safe start and maintain its hold in the international currency markets. Moreover, a BRICS currency is yet-to-be-launched and the nuances about the formation of the new tender are kept under wraps.
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Read here to know how many sectors in the US will be affected if BRICS stops using the dollar for trade. However, despite being the biggest buyer of gold, the US has more of the precious metal than all of the BRICS countries combined.