Poland holds more gold than the ECB
The National Bank of Poland has reached a symbolic milestone. Its gold reserves have hit approximately 550 tonnes, now surpassing those of the European Central Bank (which stand near 506 tonnes). While the country has been steadily accumulating over recent years, it has significantly ramped up its pace since 2023.
Gold is indeed perceived as a safe-haven asset, independent of monetary policies and less exposed to financial risks. By strengthening its reserves, Poland seeks to secure its assets and gain autonomy amid international economic uncertainties.
Poland's gold reserves. Source: tradingeconomics
The Taiwanese market moves ahead of London
Taiwan's equity market has just overtaken that of London in terms of market capitalization, reaching approximately $4,140bn, compared to $4,090bn for London. This shift is largely explained by renewed interest in technology stocks, against a backdrop of easing tensions in the Middle East. However, the Taiwanese market remains highly concentrated. The semiconductor giant TSMC alone represents over 40% of the national index.
Conversely, the City of London is paying the price for its lack of tech players therein. This absence penalizes its growth compared to markets dominated by innovation.
A historic gap in Brent
Recently, hopes for an end to the conflicts in the Middle East have helped soothe investor fears. Brent crude, which was trading around $115 a barrel just a few weeks ago, now appears to have stabilized below $100. However, futures prices do not seem to reflect the actual trading price of black gold.
Dated Brent is a benchmark representing the price of a barrel for immediate delivery. It typically trades slightly above futures while following the same trends. However, the correlation between these two indices has recently broken down. Historically, the gap between the two prices was $1 to $2, but the spread has widened to reach $35.
This historic discrepancy highlights an important point: although markets have eased, it remains just as difficult to replenish stocks for immediate delivery, even if futures suggest a decline in prices.
Does the world prefer gold to the dollar?
US Treasury holdings at the Federal Reserve Bank of New York have fallen to their lowest levels since 2012. Foreign central banks sold over $90bn in just five weeks.
This situation is primarily explained by the context of importing countries. Turkey and Thailand are selling securities in hopes of defending their currencies and offsetting the sharp rise in energy prices. But the decline might not stop there. Exporting countries could also be forced to sell their reserves to compensate for the drop in oil revenues following the closure of the strait.
For the first time since the mid-1990s, gold represents a larger share of central bank reserves than US Treasuries.
