Betting on gold! Central banks around the world to continue buying gold this year; holdings to see big increase

Time of India

5 hours ago

Gold retains its position as a reliable protective asset, helping to minimise risks during persistent economic and geopolitical instability. (AI image)
Gold continues to be a favourite for central banks! Amidst rising global economic uncertainties and geopolitical tensions, central banks around the world will continue to stock up on gold, says a World Gold Council survey.
Gold retains its position as a reliable protective asset, helping to minimise risks during persistent economic and geopolitical instability.
According to fresh 2025 statistics published by the World Gold Council on Tuesday, approximately 95 per cent of reserve managers anticipate continued growth in central banks' gold reserves over the next 12 months.
This figure marks the highest level since monitoring began in 2019, showing a substantial increase of 17 per cent compared to 2024 results.
The 2025 Central Banks Gold Reserves (CBGR) survey, which includes responses from 73 central banks worldwide, reveals that approximately 43 per cent of these institutions intend to expand their gold holdings within the coming year.
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Reserve managers maintain their positive stance towards gold, despite its current peak prices and a consistent 15-year trend of central bank acquisitions.
The primary reasons for maintaining gold reserves have evolved to focus on its value preservation capabilities (80 per cent), portfolio diversification benefits (81 per cent), and reliable performance during challenging periods (85 per cent).
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Central banks within emerging markets and developing economies (EMDE) continue to express optimism regarding gold's future significance in their reserve portfolios.
A significant proportion of EMDE respondents (48 per cent) anticipated an increase in their gold reserves within the next 12 months, whilst only 21 per cent of advanced economy respondents shared this outlook, showing an increase from the previous year.
For EMDEs, inflation (84 per cent) and geopolitical circumstances (81 per cent) were primary considerations for holding gold, alongside interest rates. In contrast, advanced economies showed lower concern, with 67 per cent and 60 per cent respectively prioritising these factors.
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There is a noticeable trend towards domestic gold storage, with 59 per cent of respondents now keeping gold locally, an increase from 41 per cent in 2024.
The majority of participants (73 per cent) anticipate a reduction in US dollar holdings within global reserves over the next five years.
The survey indicates that alternative currencies, including the euro and renminbi, alongside gold, are expected to gain prominence in global reserves during this period.
Shaokai Fan, Global Head of Central Banks & Head of Asia-Pacific (ex-China), commented: "After eight years of conducting this survey, we have reached an important milestone: nearly half of the central bank respondents intend to increase their own gold holdings in the coming year."
"This is remarkable, especially considering how many record-high prices we've hit so far in 2025. Notably, this reflects the current global financial and geopolitical environments. Gold remains a strategic asset as the world faces uncertainty and tumult. Central banks are concerned about interest rates, inflation, and instability - all reasons to turn to gold to mitigate risk," added Shaokai Fan.
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