Gold is the master of reserves .. What is the reason for this?

A recent report published on the “Interest.com” platform stated that the concept of “reserve currency” exceeds in essence the mere size of the national economy of the exporting state, explaining by journalist Navamia, in public that the global position of any currency or financial origin is based on 3 basic pillars: confidence, liquidity, institutional acceptance by the major official and financial authorities.

According to the analysis issued by the Research Department at the UBS International Bank, gold represents the most prominent example of the reserve asset, although it is not a traditional currency, because of its formal support and stable investment behavior in periods of uncertainty, which is not available to the same amount in white minerals such as silver, platinum and baladium.

Gold proves its position and institutional demand resolves competition

The UBS report -which was reported by Investang.com that gold is still the preferred origin of investors in light of geopolitical and economic fluctuations, as gold prices benefit from supporting the official sector, which does not apply to the rest of the precious metals.

Platinum and platinum without cash weight

According to the report, platinum lacks clear request engines, while pacalium performance is excessively associated with the auto sector, making it less attractive as a value of value. The mineral also suffers from poor liquidity and high sensitivity to the market, which makes them inappropriate as backup assets despite the possibility of high prices in the short term.

Reserves need more than a good price

The report issued by UPS concluded by emphasizing that “what makes the pre -trial origin is not price expectations or balance and demand, but continuous demand, support for the official sector, and investor confidence”, which are clearly manifested in gold, and absent from white metals.

Intefsting.com concluded that these criteria represent the basis on which the decisions of the central banks and sovereignty funds are built in choosing their reserve assets, which explains the continuation of gold in preserving its position despite the development of markets and the diversity of modern financial tools. (Al -Jazeera Net)