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Portugal’s central bank opens its vaults for rare glimpse of gold bars
Global Banking & Finance Review®
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By Sergio Goncalves and Pedro Nunes
LISBON (Reuters) – Portugal’s central bank has opened up its heavily guarded vaults in a small commuter town near Lisbon, giving a rare glimpse of where some of the country’s gold reserves are kept.
The 67,000 square metre compound in Carregado houses an ultra-secure vault where 45% the Bank of Portugal stores 382.6 tonnes of gold. The remaining 55% is abroad, mostly in the Bank of England in London.
“Gold is an important asset for central banks as it is a refuge asset and has no credit risks,” said Bank of Portugal board member Helder Rosalino on Tuesday during the rare media visit to the facility, guarded by armed police officers.
The compound, which opened in 1995, is protected by alarms and surveillance cameras, and its multiple doors have keypad lock systems that have become more sophisticated over the years.
The gold bars, which weigh 12 kilograms (26.46 lb) each, are stacked on hundreds of shelves in a vault behind armoured doors. Only three staff members can open them by using a code on a rotary knob, by turning two keys and then waiting for a fourth person to enter another code remotely from a control room.
Rosalino said that since 1999, when the euro currency was officially created, the value of Portuguese gold reserves has increased by 16.8 billion euros. It rose 4.3% to around 19.8 billion euros last year alone.
He said 2021’s increase was due to the appreciation of the U.S. dollar against the euro. Gold is priced in U.S. dollars.
Portugal has the world’s 14th largest gold reserve, with its value representing the equivalent of nearly 10% of the country’s gross domestic product.
(Reporting by Sergio Goncalves and Pedro Nunes; Editing by Catarina Demony and Jane Merriman)
A central bank is a financial institution responsible for managing a country's currency, money supply, and interest rates. It also oversees the banking system and implements monetary policy.
Gold reserves are the amount of gold held by a country's central bank as a form of financial asset. They are used to back the country's currency and stabilize the economy.
A refuge asset is an investment that is expected to retain or increase in value during times of market volatility or economic downturns, such as gold.
Gold is significant for central banks as it serves as a stable store of value, provides liquidity, and can act as a hedge against inflation and currency fluctuations.
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