Group 1 - The European Central Bank (ECB) reports that gold has surpassed the euro to become the second-largest official reserve asset globally, accounting for approximately 20% of total official reserves by the end of 2024, compared to the euro's 16% [1] - The increase in gold's share is driven by significant gold purchases by central banks and record-high gold prices, with central banks buying over 1,000 tons of gold for the third consecutive year in 2024, which is double the average level of the 2010s [3][4] - Gold prices have surged nearly 62% since the beginning of 2024, reaching a historical high of over $3,500 per ounce in mid-April, surpassing the peak during the 1979 oil crisis when adjusted for inflation [3] Group 2 - Approximately two-thirds of central bank gold purchases are for asset diversification, while about 40% are to hedge against geopolitical risks, with demand for gold rising sharply since the onset of the Russia-Ukraine conflict in 2022 [3] - The total amount of gold held by global central banks is projected to be around 36,000 tons by the end of 2024, nearing the historical high of 38,000 tons set in 1965 [4] - Despite the increase in gold holdings, the US dollar remains the dominant global reserve asset, accounting for 46% of total reserves in 2024, while the euro's share in global foreign exchange reserves remains stable at 20% [3][5] Group 3 - The ECB notes a break in the historical correlation where gold becomes cheaper when the real yields of other assets rise, as investors increasingly view gold as a tool for hedging political risks rather than inflation [5] - The euro's international role remains stable, with a significant increase in euro-denominated bond and loan issuance, growing over 40% to approximately $900 billion, with bonds making up two-thirds of this issuance [5]