Deutsche Bank recently said in a recent research note to clients that gold prices are positioned to benefit from a fragmented world as central banks prioritise gold holdings over the US dollar as their go-to reserve asset.
The German brokerage expects central banks, particularly emerging economies, to continue ramping up their gold holdings as a financial hedge against Western sanctions. Deutsche Bank had estimated that these central banks have added more than 225 million ounces of gold to their reserves since the 2008 global financial crash, while their USD holdings declined in tandem from a peak of 60% in the early 2000s to around 40% at present.
