According to the IMF central banks from at least twelve nations added to their gold holdings during the month of March.
The purchases were led by Mexico which bought 16.8 tons, Russia which bought 16.5 tons and Turkey which added 11.5 tons. Kazakhstan, Ukraine, Tajikistan and Belarus also increased their reserves of the yellow metal.
During 2011 central banks around the world bought 439.7 tons of gold, the most in almost five decades, and the London- based World Gold Council predicts that they are likely to buy a similar amount this year.
Central banks are reducing their reserves of fiat (paper) currency because they know how quickly it’s losing its value compared with real money. i.e. gold.