The world is stocking up on Gold

The penchant for accumulating gold is not just an Indian trait, it seems. Even as finanace minister P Chidambaram clamps down on gold import to contain CAD, central banks and households the world over have been betting on gold, either as a hedge against any loss in dollar value or as an investment.

Central Banks’ Gold Demand

Central banks globally have been buying gold to add to their stock of foreign exchange reserves, especially in the post-crisis period since 2009, the World Gold Council data shows. This is largely because they started losing faith in the dollar’s strength as the US economy was hit by the crisis in the sub-prime mortgage market.