In view of Hungary’s long-term national and economic strategy goals, the Magyar Nemzeti Bank has decided to increase the country’s gold reserves from 94.5 tonnes to 110 tonnes. The growing momentum of the global economic, geopolitical and capital market trends that have led to the appreciation of the role of gold in recent years have contributed to the decision to increase gold reserves. Amid increasing uncertainty in the global economy, the role of gold as a safe haven asset and a store of value is of particular importance, as it enhances confidence in the country and supports financial stability. Gold continues to be one of the most important reserve assets globally, as evidenced by the significant purchases of gold by central banks in recent years. Following the increase in its gold reserves, Hungary has the highest gold reserves per capita in the Central and Eastern European region.
In 2024, the centenary year of the founding of the Magyar Nemzeti Bank, the MNB decided to increase its gold reserves from 94.5 tonnes to 110 tonnes, taking into account Hungary’s long-term national and economic strategy goals.
In recent years, the global economic, geopolitical and capital market trends that have contributed to the appreciation of gold have intensified. Gold has played a variety of roles in different financial systems throughout history. It is an effective complement to foreign exchange reserves even under normal market conditions. In times of heightened financial and geopolitical uncertainty and under extreme market circumstances, the role of gold as a safe haven asset and store of value is of particular importance as it can enhance confidence in the country and underpin financial stability. Because of all these advantages, gold remains one of the most important reserve assets worldwide. Central banks’ demand for gold has confirmed this in recent years: central bank purchases continued to rise in 2021-2022, reaching a historic peak in 2022 (1,082 tonnes), and in 2023, central bank demand continued to exceed 1,000 tonnes, slightly below the historic peak.
The Magyar Nemzeti Bank has held gold reserves since its establishment in 1924, but its holdings have fluctuated widely over the decades. Gold reserves rose until the Second World War, when, at the end of the war, the Bank rescued some 30 tonnes of gold bullion and gold coins on the MNB’s legendary ‘Gold Train’ to Spital am Pyhrn in Austria. As the war ended, gold reserves were returned to the country and used as collateral to support the stabilisation of the Hungarian economy and financial consolidation when the forint was introduced. During the political transition, Hungary’s gold reserves were reduced in several stages to a minimum level of around 3.1 tonnes.
In line with the country’s long-term national and economic strategy objectives, the MNB boosted its gold reserves by more than tenfold to 31.5 tonnes in 2018, and then tripled them to 94.5 tonnes in 2021. By increasing the current level of gold reserves to 110 tonnes, the MNB continued its process of purchasing gold it began in 2018 to achieve its long-term national strategy goals. Hungary’s gold reserves have thus risen to a record level. Following the increase in its gold reserves, Hungary’s gold reserves per capita have risen from 0.32 ounces to 0.37 ounces. As a result, Hungary currently has the highest gold reserves per capita in the Central and Eastern European region.