Industry Odisha Bureau, Sep 04 : Central banks are rethinking where their gold reserves should physically sit. De Nederlandsche Bank recently moved about 86 tonnes from North America to London. It cited rising geopolitical unrest and crisis preparedness. The decision highlights a broader shift in reserve-management priorities. Gold’s strategic role is expanding beyond simple interest-rate sensitivity.
Before the transfer, DNB held 31.3% of its gold in New York and 19.7% in Ottawa. Both locations now hold 18.5% each, while London’s share has risen to roughly 32%. DNB holds 612.4 tonnes overall, valued at €72.2 billion at end-2025. Only 27 tonnes were physically shipped to its Zeist vault. The remaining 59 tonnes were sold in New York and replaced with gold bought in London. London’s deep wholesale market lets central banks trade ownership without moving bars, making reserves faster to deploy.
This access question has become central to reserve management. An asset can be liquid in normal times yet inaccessible during a rupture. The freezing of Russian central-bank reserves in 2022 made this vivid. Western governments immobilised hundreds of billions of dollars in Russian assets. That episode reshaped how reserve managers think about foreign-held gold reserves and other holdings.
India has taken a related but distinct path. The Reserve Bank of India has repatriated overseas gold steadily since 2023. Its overseas share fell from about 55% to 22% by March 2026. Unlike DNB, the RBI has not cited a specific geopolitical threat. France also removed 129 tonnes from the New York Fed, though officials called it apolitical. Germany, meanwhile, keeps roughly a third of its gold in New York, with Bundesbank leadership expressing confidence in its safety. There is no evidence of coordinated European withdrawal from US vaults.
These moves accompany a broader surge in central-bank gold buying. The World Gold Council says purchases have averaged nearly 1,000 tonnes annually since 2022, roughly double the prior decade’s pace. Gold’s price behaviour has shifted too. Real yields rose sharply between 2022 and 2023, yet gold still gained. It later surged further even as yields eased, suggesting geopolitical risk now matters more than rates alone.
US fiscal concerns add another layer. Government debt near $32 trillion, with further growth expected, is pressuring bond-market term premiums, according to strategists. Goldman Sachs Research raised its gold forecast to $4,900 an ounce by end-2026, up from $4,600. It expects central banks to buy roughly 50 tonnes monthly this year, versus 17 tonnes before 2022. June buying reportedly reached 100 tonnes, with China the largest identifiable buyer.
Goldman analysts describe this as a multi-year diversification strategy, not a one-off reaction. Growing use of gold options could amplify price swings in either direction. None of this confirms an imminent crisis. It does suggest gold reserves are increasingly treated as strategic insurance against geopolitical and financial-system uncertainty.
