Russia and China are stockpiling gold, helping to drive the precious Yellow metal to its highest marks in more than 6 years.
The People’s Bank of China has added about 100 tonnes of gold to its reserves since December. Russia has bought 106 tonnes bullion so far this year.
“They can read the writing on the wall,” Peter Schiff said on TV, adding that the 2 countries are “preparing for the world where the USD is no longer the reserve currency.”
China’s gold reserves now stand at more than 1,950 tonnes, Russia has more than 2,200 tonnes, and has the 5th-largest stockpile by country in the world.
Beijing’s gold purchases, which amount to 100 tonnes since December, come as it has been less aggressively buying US Treasuries during this trade dispute. In June, China fell behind Japan as the world’s largest holder of US debt, a title it had held since May 2017.
Russia meanwhile, has more than 4X’d its reserves over the past decade a promise to break its reliance on the USD. Russia’s central bank has bought 106 tonnes so far this year.
Trade dispute uncertainty and worries about the health of the global economy have helped drive gold prices to their highest marks in 6 years. The precious metal is up almost 18% YTD and last month hit $1,550 oz for the 1st time since April 2013.
Prices of precious metals look set to remain elevated, but their recent rally looks technically overdone, we see gold hanging around $1,500 oz for the rest of the year barring a Black Swan event.