National Bank of Poland (NBP) has earned over $1 billion in unrealized profit from purchasing large amounts of gold in 2018 and 2019 after the last few months witnessed a dramatic rise in gold prices.
The price per ounce has exceeded $1,600, and though this is still short of the $1,900 record of 2011, the trend has been upward.
The rise in the price of gold has been caused by uncertainty on the market over the US-China trade conflict and the dramatic spread of coronavirus, which is showing signs of significantly impairing global trade.
This is why the NBP gold purchases in 2018 and 2019, when its price was considerably lower, have been hailed as forward-thinking by financial authorities. The purchases also contributed greatly to bolstering Poland’s gold reserves from 126 to 229 tons.
The NBP has over the past two years purchased 126 tons of gold for a sum of $5 billion. At today’s prices, that gold is now worth over $6 billion.
The 229 tons now in stock in Poland brings the NBP into line with the average gold reserves for central banks in the world.