Gold overtakes US Treasuries as central banks increase reserves

Central banks around the world are accelerating their shift toward gold, reinforcing the precious metal’s position as one of the most trusted reserve assets in the global financial system. A new survey by the World Gold Council shows that monetary authorities continue to increase gold holdings as they seek greater protection against inflation, geopolitical tensions, and long-term economic uncertainty.

The 2026 Central Bank Gold Reserves Survey found that nearly 89% of participating central banks expect global gold reserves to rise over the next year, while almost three-quarters believe the U.S. dollar’s share of global reserves will gradually decline over the next five years. The findings highlight a growing effort by reserve managers to diversify national assets beyond traditional dollar-denominated investments.

Central banks have purchased around 1,000 tonnes of gold annually over the past four years, representing one of the strongest periods of official-sector buying in modern history. Analysts say the sustained demand reflects confidence in gold’s long-term role as a safe-haven asset rather than short-term price movements.

Despite recent weakness in spot gold prices caused by elevated U.S. interest rates, a stronger dollar, and easing geopolitical tensions, reserve managers continue to view bullion as an effective hedge against inflation, financial instability, and currency volatility. Unlike foreign government bonds or bank deposits, physical gold carries no counterparty risk and remains outside the reach of international financial sanctions.

The survey also indicates that nearly half of the participating central banks are considering increasing their own gold holdings over the coming year, marking the highest level of buying intentions since the survey was introduced. The trend reflects growing concerns about global debt levels, shifting geopolitical alliances, and the need for more resilient reserve portfolios.

The continued accumulation of gold could also provide long-term support for the global mining industry. Strong official demand improves long-term price expectations, encouraging investment in new mining projects and making it easier for producers to secure financing for future expansion.

While financial markets continue to react to changes in monetary policy and interest rates, economists believe central bank purchases have become one of the strongest structural drivers supporting gold over the long run. As countries continue diversifying reserves and reducing reliance on traditional reserve currencies, gold is expected to remain a cornerstone of global reserve management for years to come.