Donald Trump News / Europe is demanding its gold from Donald Trump, why is there so much commotion

Donald Trump News: Gold has always been seen as a safe investment i.e. 'safe haven' all over the world. Whenever situations like war, economic recession, or geopolitical tensions arise at the global level, big investors consider it safer to invest their money in gold. The result is that its prices start increasing rapidly in times of crisis.

But this time the matter is not just about the price of gold or the investment mentality, but a diplomatic concern. Many countries of Europe are now demanding the return of their gold deposited in America. This step is being taken due to the possibility of Donald Trump's possible return to power.

Why has the demand for return of gold arisen?

There is a growing fear in Europe that if Trump becomes the US President again, he can challenge the independence and transparency of American institutions. Countries like France, Germany and Italy are either demanding the return of their gold reserves deposited in America or want an independent and transparent audit of it.

The Taxpayers Association of Europe (TAE) has also supported this demand. The organization says that even if the gold is kept abroad, ownership, transparency and control over it should remain.

Why is Europe's gold kept in America?

After the Second World War, in the atmosphere of instability in Europe, many countries turned to America and Britain to keep their gold reserves safe. In that era, the Federal Reserve Bank of New York and the Bank of England in London were considered the most reliable.

Even today, about 50% of Germany's gold is kept in an 80 feet deep vault in New York, which is located under the rocks of Manhattan.

Questions on transparency earlier too

Earlier too, German MPs were not allowed to physically inspect their country's gold in America. This move had raised serious questions on the transparency of foreign gold kept in American vaults.

Why is Trump's return becoming a concern?

During Trump's previous tenure, he had repeatedly made statements about the autonomy of the Federal Reserve. He was in favor of cutting interest rates and kept making controversial comments to put pressure on the Fed. European countries now fear that if Trump comes to power again, the US may refuse to stop or return foreign gold reserves.

What is the global situation of gold?

• Currently, central banks around the world are buying gold at an unprecedented level. More than 1000 tonnes of gold was purchased every year for three consecutive years in the years 2022, 2023 and 2024. There are two main reasons for this:
• Rising inflation: A major way to avoid the falling purchasing power of paper currencies.
• International instability (Geopolitical Uncertainty): Reasons like Russia-Ukraine war, China-Taiwan tension and Middle East conflict.