New insight from City Index has revealed that gold investment jumped 18 per cent in 2022, largely driven by central banks using the precious metal as an inflation hedge. Despite the rise in investment, Federal gold reserves in Australia have not budged since 1997.
Australia’s gold reserves have remained stable over the last two decades at 79.85 tonnes. City Index called this the result of Australia’s significant gold mining industry, which ranks number two in the world for production, and takes top spot in terms of total gold resources.
“As a result, the country hasn’t needed to purchase additional gold reserves. Most of Australia’s gold production is exported to international markets, where it’s sold to central banks, jewellery manufacturers, and investors,” City Index said.
In contrast to some European nations, which are actively increasing their gold reserves, the Reserve Bank of Australia (RBA) has a differing perspective on gold as a safe-haven commodity. The bank reports that gold has not played a significant role in mitigating economic crises, which has informed its decision not to augment gold reserves.
In 1997 the RBA reduced its gold holdings from 247 tonnes to 80 tonnes and has not bolstered its supply since.
“Unlike its international peers, Australia has reduced its gold acquisitions in recent years. This shift can be attributed, in part, to the country’s traditionally stable economic climate, which has reduced the need for gold as a hedge against economic volatility,” City Index head of market research Matt Weller said.
“The RBA’s approach to gold reserves reflects a carefully considered evaluation of its economic context, marked by economic stability and a relatively insulated position on the global stage.”
This stands in stark contrast to other parts of the world where gold investment is essential to a country’s economic stability. Hungary, for example, increased its gold holdings by almost 3000 per cent in the last decade, while Poland increased its reserve by over 122 per cent.
| Country | Last Year End 13 | Last Year End 22 | % increase 2013-2022 |
| Hungary | 3.08 | 94.49 | 2967.86% |
| Poland | 102.92 | 228.67 | 122.18% |
| Ireland | 6 | 12.04 | 100.67% |
| Czechia | 10.85 | 11.96 | 10.23% |
| Greece | 112.16 | 114.24 | 1.85% |
| France | 2,435.38 | 2,436.75 | 0.06% |
| Portugal | 382.48 | 382.57 | 0.02% |
| United Kingdom | 310.25 | 310.29 | 0.01% |
| Australia | 79.85 | 79.85 | 0.00% |
Data courtesy of City Index.