Central Banks Betting Big on Gold as Prices Correct

The recent gold price correction may be an opportunity for investors to buy into the SPDR Gold MiniShares Trust (GLDM), according to Sean Brodrick, editor at Weiss Ratings Daily. Higher interest rates have slammed gold prices in the short term, but central banks are not worried about what the Fed might say soon.

A recent survey by the World Gold Council found that 89% of central banks expect global central-bank gold reserves to increase over the next 12 months, and a record 45% said they expect their own institution to buy more. This is a vote of confidence in gold, which may lead to a significant price rise in the long term.

Central banks are restructuring their reserves for a world that may look very different five or ten years from now. Goldman Sachs expects central banks to buy an average of 50 tonnes per month this year, nearly three times the pre-2022 pace. GLDM holds physical gold in London vaults and has about $32 billion in assets, with an expense ratio of just 0.10%. It currently earns a Weiss Rating of 'B-'.