Central banks bet big on gold as reserves surge past 1,000 tonnes again

Central banks worldwide have added over 1,000 tonnes of gold annually for the third consecutive year, according to the 2025 Central Bank Gold Reserves (CBGR) survey. This sustained surge in gold accumulation marks a significant departure from the decade-long average of 400-500 tonnes, signaling  pivot in reserve management amidst deepening geopolitical and economic uncertainty.

 

The World Gold Council’s latest survey – the most comprehensive since its inception eight years ago – collected responses from 73 central banks between 25 February and 20 May, reflecting the growing engagement of monetary authorities with the yellow metal.  

"Gold’s performance during times of crisis, portfolio diversification and inflation hedging are some key themes driving plans to accumulate more gold over the coming year," said the World Gold Council in its report.

 

   

Gold’s Strategic Appeal Strengthens

According to the 2025 findings, a record 43% of central banks expect to increase their gold reserves over the next 12 months, while none anticipate reducing them. An overwhelming 95% believe global central bank gold holdings will continue to grow during the same period.

 

Key reasons behind this bullish outlook include gold’s resilience during economic shocks, its inflation-hedging capabilities, and its continued effectiveness as a diversifier in increasingly complex portfolios. Central banks consistently cite gold's safe-haven appeal—especially during volatile market periods—as a key reason for its rising allocation.

 

Shift Away from the US Dollar?

Another important trend observed in the survey is a projected decline in the dominance of the US dollar in global reserves. Around 73% of respondents anticipate moderate to significantly lower dollar holdings in the next five years, with a corresponding increase in euro, renminbi, and gold allocations.

 

This shift reflects both macroeconomic realignments and a growing desire among emerging economies to diversify away from traditional Western reserve currencies. For many, gold provides a neutral and universally accepted store of value, free from the geopolitical strings often attached to fiat assets.

 

Gold Reserve Management Becoming More Active

The number of central banks actively managing their gold reserves increased from 37% in 2024 to 44% in 2025, with risk management emerging as a more prominent driver than tactical trading. This signals a more hands-on approach to gold allocation, with institutions seeking not just safety but also stability and performance from their gold holdings.

 

In terms of storage, the Bank of England remains the top vaulting choice, preferred by 64% of respondents. However, there's been a notable rise in domestic storage: 59% of central banks now store at least some of their gold at home, up from 41% in 2024. Yet only 7% plan to increase domestic storage in the coming year, suggesting most institutions are still content with current arrangements.