The value of the gold reserves of the Bank of Mexico (Banxico) fell 4.95% during February, due to the decrease in the international price of the precious metal, according to data from the central bank.
In the second month of 2023, Banxico’s gold reserves had a value of 7,056 million dollars, compared to 7,423 million dollars in January.
Compared to February 2022, the value of reserves decreased 4.18 percent. A year ago, gold prices rallied amid uncertainty over the war between Russia and Ukraine.
Banxico increased the volume of its reserves. At the end of February, it reported having 120.28 tons, compared to the 120.03 tons it had reported in the two previous months.
However, despite the increase in volume, the value fell compared to January.
The spot gold price averaged $1,827.15 per ounce in February, a drop of 5.22% compared to the average it had in December 2022 ($1,927.88).
“In February there was a contraction and it is because the dollar is beginning to strengthen and the Fed began to say that inflation is still high and that we should not trust that the end of the rate increases has already arrived,” said Ana Azuara. , Raw Materials analyst at Banco Base.
In March, the price of gold rebounded to its highest monthly average ($1,969.00 per ounce) since August 2020, amid fears of a global financial crisis coupled with a recession following the failure of Silicon Valley Bank. For this reason, Banxico’s gold reserves are expected to recover their value in March.
Banxico’s gold represents barely 3% of all the international reserves of the central bank, whose total value amounted to 204.686 million dollars.
Most of the reserves (86% of the total) are in foreign currency, while 8% are special drawing rights (SDRs), 2% is a reserve position of the International Monetary Fund (IMF) and 1 Remaining % are other unspecified assets.
Mexico in place 35
With 120 tons of gold, Banxico is the 35th central bank in terms of metal reserves, surpassed by banks such as Brazil (129.7 tons) and Spain (281.6 tons), among others, according to data from the World Gold Council. .
The central bank with the largest gold reserves is the United States Federal Reserve (Fed), with 8,133.5 tons of the precious metal at the end of February.
The Fed is followed by the Central Bank of Germany, with a reserve of 3,354.9 tons, the International Monetary Fund (IMF) with a stock of 2,814.0 tons, and the Central Bank of Italy (2,451.8 tons).
The fifth central bank with the most reserves is that of France (2,436.8 tons), followed by Russia and China, with gold reserves of 2,329.6 and 2,050.3 tons, respectively.
In February, the bank that added the most reserves was that of China, with the addition of 24.9 tons to the coffers of the People’s Bank of China. While the Bank of Turkey acquired 22.5 tons of the metal in the second month of the year.
Hit a high of more than a year
Gold rises 2% in Easter due to rate slowdown bets
The price of gold rose 2.04% in the week, after the precious metal hit a maximum of more than a year due to bets on a slowdown in the increase in interest rates in the United States.
Spot gold hit a high of $2,032.20 an ounce on Tuesday, a level not seen since March 2022, after weak US economic data released fueling bets on a slowdown in rate hikes.
The precious metal closed the week with a price of 2,008.02 dollars per ounce, compared to the close of 1,967.90 dollars of the previous week.
Another factor helping gold last week is the dollar index, which was hovering around two-month lows, while 10-year US Treasury yields hit a seven-month low.
Market reactions to the US jobs data for March (which was released on Friday) will be gauged until Monday, as most financial markets were closed for Good Friday.
In the first hours of operation on Monday in the Asian markets, the price of the metal pointed to a drop of less than 1.00%, trading at times below 2,000 dollars per ounce.
Other precious metals also pointed to increases in Holy Week.
Silver, for example, rose 3.68%, platinum advanced 0.81%, while palladium gained 0.42 percent. (With information from Reuters)
