Banco de Portugal (BdP) is one of the largest holders of gold in the world, Elder Rosalino emphasized at the LBMA (London Bullion Market Association) conference. The BdP administrator highlighted the benefits of this “the only reserve asset free from political and credit risk”.
Elder Rosalino began by explaining that central banks are among the world’s largest holders of gold reserves, as it is the main foreign exchange reserve asset to hold in case of an emergency.
“Gold is a highly liquid asset that can be easily sold in an emergency to meet the government’s urgent liquidity needs or for foreign exchange,” he explained.
Helder Rosalino also emphasized that “Banco de Portugal is one of the largest gold holders in the world and is currently ranked 14th in the World Gold Council.” Banco de Portugal owns gold on behalf of the Portuguese state and its reserves increased significantly between the 1950s and 1976.
Gold is now an important part of BdP’s reserve management strategy, which has been actively managing part of its gold reserves since 1998 to boost returns in the derivatives market.
Most of the reserves are held in BdP vaults, but about half of Portugal’s gold reserves are held by the Bank of England, the Bank for International Settlements and the Bank of France, and are also available and used for investment purposes in London. and Paris.
In an environment of high uncertainty, Elder Rosalino believes that the demand for gold will increase mainly for two reasons: “On the one hand, since gold has served as an effective hedge against inflation several times in the past… one of the safest assets.”
