A significant shift is underway in global reserve management, as central banks increasingly turn to gold to bolster their portfolios against a backdrop of persistent market volatility and declining confidence in traditional store-of-value assets. The numbers are telling: 45 per cent of central banks surveyed by the World Gold Council expect to boost their gold reserves over the next 12 months, up from 43 per cent last year.
The trend is clear: gold has emerged as the top reserve asset, surpassing US government treasuries in this assessment. This comes as nearly 90 per cent of central bank reserve managers anticipate a continued rise in gold holdings, driven by a recognition of its value as a portfolio diversifier – acknowledged by over eight in ten respondents.
The reasons for this accelerated accumulation of gold are multifaceted. Central banks cited ongoing geopolitical uncertainty, particularly referencing conflicts in the Middle East, alongside persistent inflation concerns and the potential for future trade disputes. Furthermore, findings from the International Monetary Fund (IMF) suggest that nearly 75 per cent of reserve managers expect the US dollar's share to decline over the next five years.
Shaokai Fan, global head of central banks and head of Asia-Pacific at the World Gold Council, notes that this evolving perspective reflects a shift away from treating gold as a legacy holding towards viewing it as an active, strategic allocation in an environment defined by geopolitical uncertainty and reserve diversification. The survey also highlights a growing trend towards domestic storage, with nearly half of central banks having relocated holdings from major gold markets to their own countries, and a further seven per cent planning to increase domestic storage over the next year.