19.7 What Assets Do Central Banks Hold?
As a result of the above influences, the investments of central banks have expanded over the years and currently consist of the following investment types/categories, generally in order of least risk.
- Gold
- US Treasury bills
- Government notes & bonds
- Government notes & bonds (below AA)
- Supranational bonds
- Agency debt (Fannie & Freddie)
- RMBS/covered bonds
- Bank deposits
- Asset-backed securities
- Corporate bond (investment grade)
- Corporate bonds (below BBB)
- Index-linked bonds
- Equities
- Alternative investments (hedge funds, etc.)
- Derivatives (for alpha and hedging)
- Other investments
The choice of investable assets continues to evolve. Some central banks are currently considering investing in natural resources (i.e., oil, gas, minerals, etc.)
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