The Return of History: Gold, the Dollar, and the Monetary Future

Deutsche Bank argues that the geopolitical era of US hegemony is ending, prompting EM central banks to shift reserves from USD to gold. This 'return of history' could drive gold to $8,000 as it reclaimed a 40% share of global reserves.

Key Takeaways

• 1.The geopolitical 'unipolar' era of US hegemony has ended, shifting the primary driver for central bank gold reserves from monetary mechanics to geopolitical environment.
• 2.Emerging Market (EM) central banks are the sole drivers of recent gold accumulation, while USD share in global reserves has dropped to 40% from 60%.
• 3.The 'Return of History' suggests a structural target of 40% gold share in global reserves, a level common prior to the 1990s.

Table of Contents

• All that glitters
• A brief history of gold
• The end of history
• The return of history
• What the future may hold
• What share of reserves should gold be?
• What might this mean for gold prices?
• What does this suggest about the monetary order to come?

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