Prompted by news about the Dutch central bank (DNB) moving gold reserves out of the US & Canada https://www.bbc.com/news/articles/cvgyn8q8gqxo
I assumed the European Central Bank bears the responsibility for the Euro, interest rates, etc. So why do member state central banks need gold reserves, or even still exist?
All of that is about the use of gold, but not about why Eurozone member state central banks (henceforth “EZMSCBs”), as opposed to the ECB, hold gold.
The EZMSCBs no longer issue individual currencies, do they? So they’re not using gold as a partial way to back their individual currencies.
Do they still get involved in market interventions re the Euro (e.g. use Euros to buy/sell gold to affect the Euro’s value)? I had assumed all that was in the purview of the ECB, hence why I was surprised to hear EZMSCBs still hold gold.
If it has a use, it has a value.
If it has value, it is a way to store wealth.
People store wealth for that day when the shit hits the fan.