Markets in the Middle East all witnessed significant double-digit y-o-y growth rates in 2021. Sony jumps on Mini LED TVs for 2022 & first QD-OLED, Tech Advisor, January 2022. Rising inflation expectations helped fuel inflows and the regions funds ended the year marginally higher (+0.7t, US$264mn). CFA Revised Exam Cuts Study Time, Stresses Practical Skills, UBS to Explore Credit Suisse Deal in Crisis Combination, UBSSeeks Swiss Backstop in Any Credit Suisse Deal, BlackRock Not Working on Rival Bid for Credit Suisse, LME Rocked by New Nickel Scandal After Finding Bags of Stones. Our 2022 Central Bank Gold Reserves Survey findings will be published later in the year. If credit is used to purchase productive resources, it helps economic growth and income. An expansion of global liquidity leads to debt growth which is favorable for financial assets and economic growth and vice versa. In June, the Russian Minister of Finance, Anton Siluanov, announced that 20% of the assets of the National Wealth Fund (NFW the Russian public pension fund will be invested in gold. WebBefore the end of the gold standard, gold was the preferred reserve currency. The most importantassetcorrelation is between the US stocks and US Bonds. But there are likely challenges too. Data are in current U.S. dollars. Total reserves comprise holdings of monetary gold, special drawing rights, reserves of IMF members held by the IMF, and holdings of foreign exchange under the control of monetary authorities. Demand in China for the beginning of 2022 could be restrained by increasing COVID-related restrictions and the current economic slowdown. But we believe that a more tactical approach to gold ETF investment also played a role, as the gold price moved within a range for much of the year. Global economic growth is monitored by calculating MacroVarGlobal PMIbased on each countrys manufacturing PMI and its relative weight to Global GDP of the 35 largest economies. There were major strategic purchases in 2021 that may not repeat soon and previous significant buyers, such as Russia and China, have been relatively inactive in recent years. Investment may face challenges from rising rates and the recent strong increase in bar and coin demand may be an additional headwind to further growth, but persistently high inflation and equity market pullbacks will likely be supportive, Consumer-driven demand should benefit from a weaker price environment with good underlying economic growth, Central banks are expected to continue buying gold but at a slower pace than in 2021. Non-reserve currency countries: Conversely, developing nations are not considered low risk hence their ability to borrow in their own currencies is limited. Please check your download folder. WebAs of September 2021, there were approximately 31,695 tons of gold reserves in the world. The best performing financial assets are emerging market stocks, international real estate, emerging countries currencies, commodities, and IL bonds (inflation linked bonds). And with healthy consumer gold demand in 2021, there was no repeat of the retailers heavy funding needs that had driven large scale inventory liquidation in 2020. In your inbox before the open, every day. The timeframes monitored are the following: 1 Day (1 trading day), 1 Week (5 trading days), 1 Month (20 trading days), 3 Months (60 trading days) Free Monitor of Germany Financial Markets & Economic trends. These totals are indicative only. This was largely due to the comparison with a weak H1 2020 when markets were in lockdown and distress selling was seen in some markets notably Thailand in response to the pandemic. The trend and momentum for each macroeconomic indicator is calculated using the following metrics. Bloomberg View columnist Barry Ritholtz looks at the people and ideas that shape markets, investing and business. FX debt is controlled by foreign central banks hence it is difficult to be repaid. The basic logic on how financial assets behaves during different economic conditions is provided below. This was 11% lower than the 1,292t seen in 2020 and 10% lower than the 2019 total, a year in which gold averaged US$1,392.60/oz, more than US$400 below the average US$1,798.61/oz for 2021. Any references to LBMA Gold Price are used with the permission of ICE Benchmark Administration Limited and have been provided for informational purposes only. We want to make the gold market, and our data, clear and easy to understand at a glance. Our new table presents only one figure for gold demand, which is measured using jewellery fabrication. Having two different measures of gold demand in the same data model could create confusion. Jewellery shops were allowed to reopen in October, but the severe effects of the pandemic in Vietnam have left consumers cautious about making high value purchases. You can change your personal cookie settings through your internet browser settings. A negative figure represents a draw-down of stocks when consumption exceeds fabrication. Currencies Fabrication is the first transformation of gold bullion into a semi-finished or finished product. During these financial crisis, catastrophic investment and economic losses where experienced. The Middle East region saw a third consecutive decline in annual bar and coin demand, to 55t (-4%). Excludes: purchases funded by the trading-in of existing carat gold jewellery (gold-for-gold exchange); and purchases of second-hand jewellery, other metals plated with gold, and coins and bars used as jewellery. Kinross total estimated proven and probable gold reserves at December 31, 2020 were approximately 30.0 million ounces. Analyzing the Global Economy and Financial risk Strong growth in the first three quarters of 2021 was largely due to base effects (i.e. Money Supply M2 of the four major central banks of the world namely Federal Reserve (US), ECB (Eurozone), PBoC (China) and BOJ (China). MacroVar for Business managers & owners: Adjust your Business to current Financial and Economic Conditions. The most important factor to predict from a fundamental point is view is globaleconomic growthtrend for the next one to three months. Get access by creating your free account using your Email, Google or Facebook. Global holdings fell 5% to 3,570t by year-end, while AUM in value terms lost 9% to US$209bn as net outflows were compounded by the 4% gold price decline over the year. 75% interest in Gosowong, as well as minor changes at Telfer and Lihir. Global annual demand by sector (World Gold Council), Sources: Metals Focus, World Gold Council; Disclaimer. End-user (consumer) demand for all newly-made carat jewellery sold at the retail level, by volume of fine gold. If credit is used for consumption it has no added value. Lastly, MacroVar ranks sectors based on our quantitative models to identify Long / Short Investment themes. But in a departure from the trend, buying was not just confined to emerging markets. A nations economy is vulnerable to economic weakness or financial stress when it experiences: Trend & Momentum indicators Jewellery fabrication is the first transformation of gold bullion into semi-finished or finished jewellery. Accessed March 18, 2023. https://www.statista.com/statistics/929799/gold-holdings-in-germany/, World Gold Council. Indian-listed funds also contributed to the regional growth with net inflows of 9t in 2021, aided by 2.5t of inflows in Q4. Password, My As in 2021, government support could factor limit the need to sell and any price weakness should it materialise would act as a further disincentive. In 2021 Thailand moved from net disinvestment to net positive investment in bars and coins. Some of this will likely wane in 2022 but economic growth should remain a catalyst for solid demand. White label accounts can distribute our data. Closing price vs moving average (MA): if price greater than MA value is +1, else -1, 2. Gold Reserves in Germany Most funds included in this list are fully backed by physical gold. Global holdings of gold ETFs fell by 173t in 2021 in sharp contrast to 2020s record 874t increase. Barrick is third with 68 million ounces of gold reserves reported in 2020, a 4% decline over 2019. Please. Neither WGC nor Oxford Economics provides any warranty or guarantee regarding the functionality of the tool, including without limitation any projections, estimates or calculations. The National Bank of Poland (Narodowy Bank Polski, NBP) increased its gold holdings by 25.7 tonnes in the second half of 2018, and a further 100 tonnes in the second quarter of 2019, the largest global single gold purchase of the last decade. The central bank, which currently holds 36.3t, has been set a target gold holding of 50t. Central bank net purchases totalled 463t in 2021. Turkey, one of several regularly active central bank over recent quarters, added 13.5t in H1, taking its official sector gold reserves to 408.2t (29% of total reserves). If you have an ad-blocker enabled you may be blocked from proceeding. All third-party content is the intellectual property of the respective third party and all rights are reserved to such party. The year ended much as it began, with nominal interest rates and inflation jockeying for position as the key driver of gold. Source: Metals Focus, Refinitiv GFMS, World Gold Council, Annual jewellery consumption rebounded to pre-pandemic levels, boosted by Q4 sprint finish. Fourth quarter demand was 10% lower y-o-y at 4t. Moreover, MacroVar monitors the following families of factors specific to a sector: Stock sectors analysis of prices, momentum, trends, charts, and news. The 52-week simple moving average and its slope are the most important indicators defining a markets trend. Mine production in Q4 2021 fell 1% y-o-y to 915t. MacroVarrisk management provides free current risk analysis. More specifically for each country the Price Expectations and New Orders expectations components of the PMI, ISM and ESI indicators are used for structuring the models. Anecdotally, increased recycling flows took place in the third and fourth quarters in some markets, including the US, as lockdowns eased and shops re-opened. However, these efforts have been worthwhile simply because demand for high-end consumer electronics has, on the whole, remained strong and the pandemic has effectively fuelled a global shortage of semiconductors.14 Stark illustrations of this include the recent announcement by Apples (AAPL) main chip supplier, Taiwan Semiconductor Manufacturing Company (TSM), that it is setting aside over US$40bn for expansion in 2022,15 and the World Semiconductor Trades Statistics group forecasting continued growth across all categories and regions of the semiconductor market in 2022.16, Annual technology demand by sub-sector (World Gold Council). Data between Q1 2010 and Q4 2013 is a synthesis of Metals Focus and GFMS, Thomson Reuters data, which was created using relatively simple statistical techniques. MacroVar uses leading economic indicators for each country to predict economic and inflation expectations. Seasonal festival demand, concerns over elevated equity valuations and safe haven demand prompted by Omicron fuelled the quarterly growth. Demand for gold in the consumer-driven jewellery and technology sectors recovered throughout the year in line with economic growth and sentiment, while central bank buying also far outpaced that of 2020. Metals Focus, All rights reserved. The performance of the stock market, bonds and currency. The description is composed by our digital data assistant. Demand was primarily supported by economic recovery from 2020 and a relatively stable gold price during the year. With 94.2 Moz reported in 2020, Newmont has the second largest gold reserves base across the industry. Central banks are the main gold Traders should watch oscillators like MacroVar oscillator and RSI to buy the dip and still follow the trend. The report gives the aggregate positions held by traders from the previous Tuesday, including the number of long contracts (that stand to benefit if prices rise) and short contracts (that benefit if they fall). Raising Credit, Easing Debt service, Print money > purchase financial assets > force investors to take more risk & create wealth effect, Print Money > purchase new debt issued to finance Gov. The decision by the National Bank of Hungary (Magyar Nemzeti Bank, MNB) to increase its gold reserves to 94.5 (SDR - special drawing rights). We have implemented a few improvements to the methodology used to calculate gold demand, as discussed in the changes to data tables and terminology section. Sri Lankas sale represented around half of its gold reserves and was done to help bolster the liquidity of its foreign reserves, which hit a 12-year low in November. Recent sales from Russia and Germany appear to be related, at least in part, to their coin-minting programmes. The majorfinancial marketswhich affect the rest of the other financial assets are: For an explanation of global mine production, please see the Notes and definitions. The degree of economic intervention depends on the countrys economic fundamentals, its currency status and credibility. While other developed market central banks have increased their gold reserves in recent years, this has typically been at a much slower pace. The sale from Germany was likely related to its long-standing coin-minting programme. Although this will be supplemented with private and smaller mines, it is almost inconsequential compared to current mine output and annual changes will probably be dominated by operational issues positive and negative in 2022. In September 2020 the central bank shifted to more actively trading gold to maintain its gold reserves at a more optimal level of around 10% of total reserves. You can change your personal cookie settings through your internet browser settings. 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The market trend signal is derived as the mean value from 8 calculations for each asset. A country can control its debt by either: 1. Annual bar and coin investment jumped 31% to 1,180t, aided by record high volumes in the US and Germany, Global gold ETFs saw outflows of 173t in 2021, a 5% decline in total holdings. Hence, an investor would want to scale back on the industrial sector and go long consumer staples. Looking into 2022 and beyond, the outlook is broadly positive as major industries are likely to continue relying on increased electrification, which will provide support for high-end PCBs. Sign up here! After adjusting for the disposal of Massawa, reserve replacement was 76% of depletion with a consistent reserve grade maintained. This was in good part linked to Q4 demand, which at 713t saw the strongest quarterly jewellery consumption since Q2 2013. in the months following the onset of a US Fed tightening cycle, 24K Hard Gold jewellery products in recent years, Reserve Bank of Indias Consumer Confidence Index, which rose to 62.3 in November 2021, consumers preferred gold-for-gold exchange, Global holdings fell 5% to 3,570t by year-end, golds role as an inflation hedge and wealth protection asset, physical gold product sales, as they exited other retail gold trading businesses, transaction between two different divisions within the Ministry of Finance, power outages in China during the third quarter, Creating a consistent data series by Dr. James Abdey, changes to data tables and terminology section, Why Were in the Midst of a Global Semiconductor Shortage (hbr.org).

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