Central bank piles up gold to increase national reserves

During the COVID-19 pandemic, especially in recent months, the price of gold has fluctuated, which the National Bank of Poland (NBP) took advantage of, purchasing another tonne of the bullion.

As economists stress, gold is a safe haven in the market. The more gold bars in the national treasury, the stronger is the economy and the more confident are the investors. This year alone, the NBP has bought nearly three tonnes of gold. In total, there are over 230 tonnes in the treasury. Nearly half of the gold was bought in the last three years, which proved to be good business for Poland.

Such a gold bar weighs 12 and a half kilogrammes and is worth around EUR 440 mln. The value of the Polish gold amounts to around EUR 11 bn.

In a time of crisis caused by a pandemic, such investments and the policy pursued by the NBP - including the reduction of interest rates and the purchase of treasury bonds on the secondary market - yielded results. This allowed the immediate cash out of funds to Polish businesses and households under the government's anti-crisis shields. A total of over EUR 30 bn euro has been disbursed since the beginning of the pandemic.

Adam Glapiński, the chairman of NBP, has announced the purchase of at least another 100 tonnes in the future. This will make Poland more secure in crisis situations.

In the autumn of 2019, 100 tonnes of gold were brought to Poland from England, some of which had made its way there in September 1939. Then, thanks to the determination of Ignacy Matuszewski, then Finance Minister of Poland, the reserves of the Bank of Poland were saved from the German invasion.