Gold has been considered not just a precious metal since the dawn of human civilization, but also a symbol of wealth, power, and stability. Its brilliance and durability have established it in a unique position, making it a currency standard, an investment haven, and an important tool for determining geopolitical strategy. Today, when a new type of uncertainty and geopolitical instability has emerged in the global economy, the record increase in gold prices is a clear reflection of its multifaceted impact.
Global Gold Stocks and Uses
To date, the amount of gold that has been mined in human history is approximately 216,265 metric tons. Two-thirds of this has been mined since 1950. Since gold is an indestructible metal, almost all of it still exists in the world in various forms. Of this, **about 97,149 tons (45%)** is in jewelry, which is its main use. In addition, **about 48,634 tons (22%)** is in bars and coins.
Central banks hold **17 percent, or about 37,755 tons** of the total gold mined. The remaining 15 percent, or about 32,727 tons, is used in various industries such as electronics and dentistry. Interestingly, despite this huge amount of gold mined, the US Geological Survey estimates that there are still about 55,000 metric tons of gold in economically extractable form underground.
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Although the amount of gold reserves held by central banks is transparently disclosed, it is difficult to estimate the amount of gold held by individuals or users. Because there are no specific records of this. However, according to the World Gold Council, about half of the total gold mined so far is held by people as jewelry or personal investments. In this case, **India and China are the world's leading countries in personal gold holdings**. In their culture, gold is not just an ornament, but also an investment, a symbol of family wealth and social status. It is estimated that the Chinese people have about 31 thousand metric tons of gold and the Indians have about 30 thousand metric tons.
War, Trade and Central Bank Strategy
In the context of wars and trade wars around the world in recent times, **Russia, China and India** have been significantly increasing their gold reserves. These countries want to keep a large part of their foreign exchange reserves in gold instead of dollars. The main reason for this is **to reduce geopolitical risk and reduce dependence on the US dollar**. When a country gets involved in a political or economic dispute with the United States, there is a risk of sanctions on the dollar-based financial system. Gold serves as a safe alternative to avoid this risk.
According to the latest data from the World Gold Council, the United States is at the top of the top 10 gold reserves (8 thousand 133.4 metric tons). Next are Germany, Italy, France, Russia and China. The growth rate of China and Russia's gold reserves is particularly noticeable in this list, which indicates a change in their geopolitical strategy. In addition, the International Monetary Fund (IMF) and the European Central Bank (ECB) also have large amounts of gold, which testifies to its importance in the global economy.
Main reasons for the increase in gold prices
The fluctuations in gold prices in the world market depend not only on the desire of traders to make profits, but also on the international economic and political situation associated with it. The main reasons for this are:
1. Economic uncertainty and geopolitical instability:
When there is a recession, financial crisis or political instability in the global economy (such as war, trade war, political conflict), investors want to keep their assets safe. Gold is then considered a **"safe haven"**. During this time, money is withdrawn from the stock market, bonds or other risky investments and invested in gold, which increases the demand for gold and increases its price. For example, the Corona pandemic and recent tensions in the Middle East have played a major role in increasing the price of gold in the market.
2. Inflation:
When the value of a country's currency decreases and the price of goods increases, people start buying gold to maintain their purchasing power. Gold is a limited resource and has its own intrinsic value, which is not affected by inflation. Therefore, gold acts as an effective "hedge" or protection during times of high inflation, which increases both its demand and price.
3. Gold purchase by central banks:
Central banks around the world keep a part of their foreign exchange reserves in gold. Recently, many central banks, especially countries such as China and Russia, have started buying large amounts of gold to reduce their dependence on the dollar and reduce geopolitical risks. This massive gold purchase by central banks is increasing the demand for gold in the international market and putting upward pressure on prices.
4. Weak US Dollar:
Since gold is usually traded in the US dollar in the international market, a fall in the value of the dollar makes gold cheaper for users of other currencies. This increases the demand for gold. When the US Federal Reserve lowers interest rates, the value of the dollar weakens and the price of gold increases.
5. Supply and demand:
The supply of gold is limited. The amount of gold extracted from the ground does not increase much each year. Currently, an average of about 3,200 to 3,600 metric tons of gold is extracted each year. On the other hand, the demand for gold for jewelry, industry and investment is constantly increasing. Its price increases due to low supply and high demand.
Future prospects and new mining areas
Currently, the countries that extract the most gold are China, Australia, Canada and Russia. Due to the discovery of new mines and the development of technology, some other countries may become potential centers for gold extraction in the future. Notable among these are Uganda, Iran, Kyrgyzstan, India, Indonesia and Bangladesh.
A large amount of gold ore has recently been discovered in the East African country of Uganda, which could bring about a major change in their economy. Similarly, there is a great potential for gold mines to be discovered in India and Bangladesh. Recently, there have been reports of gold ore being discovered in some places in the northern part of Bangladesh, such as the Madhyapara mine in Dinajpur and Palashbari in Gaibandha. Although it is still in its early stages, it may be possible to extract gold commercially from these places in the future. In addition, research is underway on extracting gold from the sea or ocean floor using new technologies, which may open up a new horizon for gold extraction in the future.
Conclusion
The fluctuation of gold prices is not only an economic issue, but also a reflection of geopolitical power, trade relations and strategic decisions of central banks. It is a kind of indicator that indicates the uncertainty existing in the global economy and the changing balance of power between countries. In the modern world, where currency values are declining and geopolitical risks are increasing, gold is proving its importance as a traditional "safe haven".