For the first time in nearly three decades, central banks around the globe have accumulated more gold than U.S. Treasuries. This development underscores a significant transformation in global reserve management, influenced by risks associated with sanctions, apprehensions regarding debt, and an ongoing pursuit of diversification. As of May, global official gold holdings reached 36,344 tonnes, as reported by the World Gold Council (WGC).

The value of these holdings has been significantly enhanced by bullion’s rise above $3,500 an ounce this year, surpassing central banks’ investments in Treasuries. The U.S. Treasury’s June 2024 survey estimated foreign holdings of Treasuries at approximately $3.8 trillion, whereas the European Central Bank (ECB) assessed the market value of official gold reserves to exceed $3.6 trillion. Central banks increase their purchasing activities. Following a prolonged period of incremental increases, central banks have significantly intensified their acquisition activities. The WGC reported purchases of 1,082 tonnes in 2022, followed by 1,037 tonnes in 2023, and a record 1,180 tonnes in 2024, which is more than double the annual average of the preceding decade.

In 2025, the momentum decelerated yet stayed high, with an addition of 244 tonnes in the first quarter and 166 tonnes in the second. Metals Focus, a consultancy based in London, maintains its forecast for net purchases to be approximately 1,000 tonnes this year. The WGC’s 2025 survey indicates that 43% of central bankers intend to increase their gold reserves in the coming year, while 95% anticipate a continued rise in global holdings. Central banks cite multiple factors driving the shift towards bullion. One notable instance is the experience of 2022, when Russia’s dollar and euro reserves were frozen. Gold, in contrast, cannot be frozen, rendering it a sanctions-proof asset in the perspective of numerous reserve managers. Another factor is apprehension regarding the increasing debt burden of the United States. As Washington engages in significant borrowing, central banks have become increasingly cautious about maintaining an excessive portion of their safety net in Treasuries.

Diversification also plays a significant role. The dollar continues to hold a dominant position in global reserves; however, central banks are progressively viewing gold as a means to diversify their portfolios and mitigate dependence on a singular currency. Gold currently constitutes 20% of central bank reserves, exceeding the euro’s 16%, whereas the dollar retains the largest proportion at 46%, as indicated in the ECB’s International Role of the Euro 2025 report.

Notwithstanding the achievement, the U.S. dollar continues to serve as the cornerstone of the global financial system. According to IMF COFER data, the dollar constituted 58% of foreign exchange reserves in 2024. The ECB’s reduced figure of 46% incorporates calculations that account for gold. Currently, the rise in gold prices indicates not the decline of the dollar but rather a reassessment of risk factors. As central banks recalibrate their reserves to prioritize bullion over bonds, this transition underscores an increasing inclination towards assets regarded as secure, liquid, and resilient ..