The World Gold Council is launching the Central Bank Dashboard, an innovative web-based tool that allows the comparison of central bank gold reserve holdings across regions, income levels, foreign exchange arrangement and other qualitative and quantitative indicators.
The Central Bank Dashboard provides users with the flexibility to visualise trends in gold and foreign exchange reserve holdings across a multitude of vantage points. Supported by an intuitive filtering system, the Dashboard allows users to quickly retrieve and compare gold reserve data between central banks peers that share one or more characteristics. It provides users with the option to:
- Select between quarterly and annual time periods to visualise trends in central bank gold and foreign exchange reserves
- Choose to show data either at a fixed point in time (snapshot), across a time period (date range), or at two different points in time (compare dates)
- Compare gold reserve holdings between different groups of central banks, selected by user-defined parameters
- Add or remove countries from the comparison through the use of a dynamic chart legend.
At its core, the primary function of the Central Bank Dashboard is to provide users with an easy way to retrieve gold reserve information about a selected group of central banks peers. The user can curate their selection through the use of the AND/OR logical operators. The AND operator returns the list of central banks that fulfil the criteria of two or more queries. For instance, the application of the AND operator to countries that have the characteristic of high income, as defined by the World Bank, and are situated in the Middle East and North Africa would return the central banks of Saudi Arabia, Qatar, UAE and others. In contrast, the OR operator can be used where the user wants a combined list of central banks that share characteristics – for example, within two regions. In the example below, using the OR operator, East Asia and South East Asia would return data from banks situated in both of those regions: China, Japan, Singapore, Malaysia, etc.
AND OR examples:
The Dashboard comes with a set of pre-defined filters to showcase the versatility of the filtering system and highlight existing trends in central bank gold reserves. The four pre-defined filters are:
- Economies with high levels of reserves
This filter highlights countries that have foreign exchange reserves above the level required for precautionary purposes as indicated by the IMF’s ARA EM metric; the IMF ARA metric is a catch-all indicator for capital adequacy. As a rule of thumb, reserves within 100 - 150% of the ARA EM metric are considered adequate. Oil- and gold-producing countries are excluded from the comparison as their reserve management considerations can be different from the rest of the world.
- Floating and free-floating exchange rate regimes
This highlights countries that employ either a floating or free-floating exchange rate arrangement. These countries typically hold less reserves as a percentage of GDP and proportionately more gold as a percentage of their total reserves. Because Western European countries have large gold legacy holdings they are excluded from the comparison; gold-producing countries have the potential to bolster their reserve holdings through the domestic purchase of gold using local currencies, and therefore they too are excluded.
- Export-driven economies in Asia
These are upper-middle to high-income economies in Asia with accumulated foreign exchange reserves that exceed three months of imports. Such economies are typically export driven and have large foreign exchange reserves accumulated over a long period of time. Excluding gold-producing Asian economies, this group holds the least amount of gold as a percentage of reserves compared to other regions.
- Belt and Road Central Asian economies
These central Asian economies are signatories to China’s Belt and Road Initiative. As a group, these countries have strong connections with China, either via export or FDI links. Some of them are also gold producers with large gold deposits. Compared to other regions they hold the largest average amount of gold as a percentage of total reserves.
The Central Bank Dashboard was developed after dialogues with central banks revealed an interest in determining the gold reserve holdings of economic peers. This information is a critical component in any gold reserve management decision-making process and the Dashboard aims to provide a comparative analysis approach to help inform central banks on the optimal level of their gold reserve holdings based on economic peers. The economic comparison of countries is facilitated through the use of three broad categories: geographical, qualitative and quantitative.
Geographical characteristics allow users to create a subset of central banks through selecting countries on an individual or regional basis. Countries in the same region may have similar cultural, political and economic systems that translate into similarities in reserve management objectives, including those concerning the purchase of gold.
Qualitative characteristics expand the comparison of central bank gold reserves beyond geography. Indicators in this category allow users to sort countries according to their income levels, exchange rate arrangements, monetary policies and other characteristics, including whether they are gold or oil producers.
Quantitative indicators look primarily at the capital adequacy ratios of countries. There are several conventional metrics used to measure reserve adequacy and the Dashboard explores five such measures, including the IMF’s ARA metric, which is a catch-all indicator for capital adequacy. Capital adequacy ratios are included because they can identify countries with high levels of reserves.
You can access the Central Bank Dashboard here. For more information on the Dashboard and for monthly and quarterly central bank gold reserve statistics, please visit Goldhub.com.
