A gold reserve is the gold held by a central bank or nation intended as a store of value and as a guarantee to redeem promises to pay depositors, note holders (e.g., paper money), or trading peers, or to secure a currency. Today, gold reserves are almost exclusively, albeit rarely, used in the settlement of international transactions. At the end of 2004, central banks and investment funds held 19% of all above-ground gold as bank reserve assets. Tt has been estimated that all the gold mined by the end of 2009 totaled 165,000 tonnes. At a price of US$1900/oz., reached in September 2011, one ton of gold has a value of approximately US$60.8 million. The total value of all gold ever mined would exceed US$9.2trillion at that valuation.
Gold definitely has caught the public’s attention; for proof, just look at the number of cash for gold ads. Gold has been rising since 2001 and its near vertical rise over the last two years helps explain some of the recent fascination, but political actions have helped as well. In the United States, Rep. Ron Paul and others have called for a return to the gold standard. Elsewhere, Venezuelan President Hugo Chávez recently nationalized his country’s gold industries, and some analysts have said countries should dip into their gold reserves to alleviate the sovereign debt crisis. With all these recent stories, we wanted to see which countries actually have the most gold in their reserves, based on information from the World Gold Council, here.
Who Has the Most Gold?
The price of gold eclipsed $1,800 per ounce in August, rising 26.0% in 2011, following uncertainty in the equity markets and the global economy as a whole. The biggest individual holders of gold—central banks, international entities and governments—are believed to account for approximately 16.5 percent of the world’s gold, holding about 30,700 tons. The numbers are taken from the monthly report produced by the World Gold Council, which is the gold industry’s key market development body. The holdings presented here are as of WGC’s August 2011 report, unless otherwise noted.
World Top 10 largest gold reserves
#1: United States
The United States Bullion Depository in Kentucky—otherwise known as Fort Knox—is the most famous gold stockpile in the world. It holds the majority of the nation’s gold reserves, the remainder of which is held at the Philadelphia Mint, the Denver Mint, the West Point Bullion Depository and the San Francisco Assay Office. Altogether, the total gold reserves of the U.S. equal 8,965.6 tons and would be valued at approximately $522.16 billion in today’s market.
Value of reserves: $522.16 billion
Holdings total: 8,965.6 tons
The Deutsche Bundesbank, Germany’s central bank, has 3,747.9 tons of gold reserves, which are valued at about $218.28 billion. According to the World Gold Council, Germany’s gold coffers account for 71.4 percent of total foreign reserves.
Value of reserves: $218.28 billion
Holdings total: 3,747.9 tons
#3: The International Monetary Fund, IMF
The International Monetary Fund (IMF) oversees international economic operations of 185 member countries. Its gold policies have changed in the last 25 years, but the reserves remain to stabilize international markets and aid national economies. In one such instance, the IMF sold a portion of its reserves in December 1999 to aid the Heavily Indebted Poor Countries Initiative. The 3,101 tons of IMF Gold would fetch roughly $180.6 billion in the open market.
Value of reserves: $180.6 billion
Holdings total: 3,101 tons
The Banca D’Italia manages Italy’s foreign reserves, which have been reported at 2,701.9 tons by the World Gold Council and comprise the fourth largest gold reserve in the world. These holdings are worth $138.33 billion and account for 71.2 percent of the country’s foreign reserves.
The French National Bank, Banque De France, is home to the country’s gold holdings, which comprise 66.2 percent of its foreign reserves. With 2,683.8 tons of gold in reserve, France’s holdings are worth approximately $156.31 billion.
Value of reserves: $156.31 billion
Holdings total: 2,683.8 tons
#6: SPDR Gold ETF (GLD)
Unlike other major gold holdings, this is one that investors can actually buy in to. As the price of gold fluctuates, so does the value of SPDR Gold Trust, also known the GLD. The fund held 38,845,889 ounces, or 1,213.9 tons of gold as of its 10-Q filing on June 30, 2011. Although gold is off it’s all time highs, during the week of August 22, 2011, the SPDR Gold Trust surpassed the heavily-traded S&P 500 SPDR (SPY) for the first time. Like many investors, the ETF has indicated they have increased their holdings of gold since their most recent filing.
Value of holdings: $70.7 billion
Holdings total: 1,213.9 tons
At 1,161.6 tons, the world’s most heavily populated country has the world’s seventh largest gold reserve. Expect it to be higher on the list? Well, bear in mind that China’s gold only accounts for 1.6 percent of its foreign reserves. With a population of 1.34 billion, the country holds about $50.49 worth of gold per person, totaling $67.65 billion.
Value of reserves: $67.65 billion
Holdings total: 1,161.6 tons
The Swiss National Bank conducts Switzerland’s monetary policy and manages the country’s 1,146.2 tons of gold. With the world’s eighth largest reserve of the precious metal, Switzerland’s supply is worth approximately $66.75 billion in today’s gold market. It accounts for 17.8 percent of the country’s foreign reserves, though this is down significantly from a year earlier.
Value of reserves: $66.75 billion
Holdings total: 1,146.2 tons
The Central Bank of the Russian Federation is in charge of the country’s 926.9 tons of gold, which are valued at $54 billion and comprise 7.7 percent of the country’s foreign reserves. In 2009, Russia increased its gold production by 21 percent, due in part to the launch of several new mines. Last year, the country overtook Japan in total holdings, adding more than 140 tons to its stockpile in 2010 alone. Russia’s buying of gold continued in 2011, purchasing 4.9 tons in July, according to the IMF’s August report.
Value of reserves: $54 billion
Holdings total: 926.9 tons
Although Japan is ninth on the list, its 843.3 tons of gold account for only 3.3 percent of total foreign reserves. On the open market, Japan’s gold reserves would be worth around $49.11 billion, and are overseen by the Bank of Japan.
Value of reserves: $49.11 billion
Holdings total: 843.3 tons