Global inflation debases currencies. Higher inflation in the US debases the reserve currency. If the inflation is transitory, central banks should not change their exposures to different currencies; however, if you believe that inflation will last for a longer time, it is time to buy hard assets. Even though we are off the gold standard, and it was described by Keynes as a "barbarous relic", central banks are buying a lot of gold - tonnes of it.
2022 and 2023 were banner years for gold buying. We believe that this is also sanction related. There is less reason to hold dollars if there is chance of sanctions reducing your ability to use those dollars. Look at the world official reserve assets in gold. It has moved from about 950m oz to above 1150m which is close to the levels seen when the world went off the gold standard. Despite high real rates and falling inflation, central banks want gold. Central banks are voting with their gold and they do not want to hold currencies that may lose their purchasing power.
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