Gold reserve policy of central banks

In recent years, countries, especially developing countries, have tended to increase their central bank reserves. Central banks hold a certain amount of reserves due to economic and financial crises that may arise as a result of economic events such as the integration of financial markets that have accelerated with globalization, the increase and development of foreign trade with global markets, fast transaction opportunities thanks to developing technology, the risk of volatility that may arise from sudden capital movements, as well as epidemics, disasters, geopolitical tensions, etc. Countries hold reserves in their central banks and may vary in their reserve instruments due to their own economic conditions, political events and various reasons. Central banks, with the amount of reserves they hold, support monetary and exchange rate policies, ensure balance of payments, protect against financial crises and reduce fragility, provide economic confidence in national and international arenas, prevent exchange rate volatility and act as a buffer in ensuring economic stability. The financial crises experienced in the world in recent years, the COVID-19 pandemic, the Russia-Ukraine war, and the tensions in the Middle East have caused countries to focus on gold reserves in their reserves. This thesis investigates the reasons why central banks hold reserves, the central bank reserves, the reserve change process, and especially the reasons for the change in reserves after the 2008 crisis, and the reasons for the shift towards gold. The strategies of selected countries, including Turkey, regarding gold reserves in recent years after the 2008 crisis have been discussed. In the light of statistical data, it has been concluded that the reserve holding strategies of countries after the 2008 crisis were affected by geopolitical developments and financial crises.