El Salvador acquires $50M in gold for the first time since 1990 as Bitcoin bet continues
Key Takeaways
- The Central Reserve Bank of El Salvador has increased its total gold holdings to 58,105 troy ounces from 44,106 troy ounces.
- Gold and silver prices recently reached record highs amid economic and political volatility.
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El Salvador’s Central Reserve Bank (BCR) announced on Thursday that it had acquired 13,999 troy ounces of gold, worth approximately $50 million, for the first time since 1990. The acquisition brings its total gold stash to 58,105 troy ounces, with an estimated value of $207 million.
Gold represents about 20% of global reserves held by central banks around the world, second only to dollar-denominated reserves. Global central banks have purchased more than a thousand tons of gold annually over the past three years, according to the central bank.
The bank stated that the move was part of its strategy to diversify its global portfolio. It followed gold’s recent rally to record levels above $3,500 per ounce.
The price movement comes as markets anticipate potential interest rate cuts by the US Federal Reserve, which is scheduled to meet on September 16 and 17.
“For the Central Reserve Bank of El Salvador, this acquisition represents a long-term positioning, based on a prudent balance in the composition of the assets that make up the country’s international reserves,” the BCR said in a translated statement.
“This operation reflects the commitment to strengthen the nation’s patrimony and ensures that the country maintains diversified, secure, and long-term reserves,” the bank added.
Alongside gold, El Salvador continues to expand its Bitcoin reserves. The government recently moved its national holdings into multiple new wallets to reduce vulnerability to potential quantum-computing threats.
Managed by the National Bitcoin Office, the system uses 14 addresses, each capable of holding up to 500 BTC.
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