Share of gold in NBS foreign exchange reserves 7.51%
– The National Bank of Serbia has this gold in the foreign exchange reserves in the form of gold bars, gold in NBS' foreign accounts and wrought gold, as defined by law – the NBS explained.
The World Gold Council has published a new list of countries featuring the biggest gold reserves, with Serbia in the 63rd spot as the country with the biggest reserves of gold in the Balkans.
The NBS said that the biggest portion of it, more than 94%, was kept in the NBS treasury, whereas the remaining portion was in the NBS' foreign account, that is, in the Bank for International Settlements in Basel.
It was pointed out that there had been sales of gold since early December 2000 and that the NBS hadn't sold gold since 2005, exclusively increasing its share in the foreign exchange reserves instead, by purchasing gold from local sources, i.e. in the local market.
– In the past five years alone, the NBS has increased its gold reserves by 4.51 tons – the central bank says.
In line with the Law on the NBS, as they add, the bank decides on forming and utilizing the foreign exchange reserves, as well as on managing and handling the reserves, in line with the monetary and foreign exchange policy.
As they add, the share of gold in the reserves reduces risk and maintains the value of investments, as this type of asset is less susceptible to influence through interest rate policies of various monetary authorities.
– Historically, gold was a means of hoarding, that is, a safe haven for maintaining the value of assets (safe haven status). Furthermore, it acts as a long-term form of protection from inflation. In addition to that, the low correlation of gold with traditional forms of foreign exchange reserves, especially with currencies like the dollar, makes this precious metal a useful form of investing foreign exchange reserves to the end of diversifying the portfolio and reducing the risk – the NBS says.
It was pointed out that the precious metal acts as a guarantee of trust in the central bank, especially in times of uncertainty.
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