Central banks worldwide are positioning themselves for unprecedented gold holdings as global volatility continues to rock markets. According to the World Gold Council's 2026 Central Bank Gold Reserves Survey, 89% of global central banks expect their gold reserves to increase over the next 12 months, with 45% of respondents specifically planning to expand their own gold reserves during this period. The survey, conducted between February 5 and May 19, reveals that only 1% expect their institutions' gold reserves to decrease, while the majority anticipate no change. As reported by the World Gold Council, this represents a record level of central bank gold accumulation intentions, driven by persistent geopolitical and economic uncertainty affecting reserve managers worldwide. The bullish outlook is particularly significant as gold has become the top reserve asset, overtaking US government treasuries, according to the latest survey findings. According to Shaokai Fan, Global Head of Central Banks at the World Gold Council, the survey demonstrates that official-sector confidence in gold remains exceptionally strong, with central banks more positive than ever on the precious metal. As the world becomes increasingly volatile and unpredictable, gold's safety, liquidity and return characteristics – the three key investment objectives for central banks – have risen in importance, with the World Gold Council noting that trends uncovered in their survey suggest central banks continue to recognise the benefits of an allocation to gold and indicate that their demand for gold will likely remain healthy into the foreseeable future.
Central banks have demonstrated a dramatic shift in their gold acquisition strategy over recent years. According to the survey findings, central banks have accumulated an average of 1,000 tonnes of gold annually over the last four years, representing a substantial increase from the 500-tonne average recorded during the previous decade. The World Gold Council attributed this trend to geopolitical and economic uncertainty that has clouded the outlook for reserve managers. The survey noted that gold's performance during times of crisis, portfolio diversification and inflation hedging were among the key reasons cited by respondents for holding the metal. This marked acceleration in gold accumulation has been particularly pronounced since the start of the Middle East conflict, highlighting gold's role as a critical hedge during periods of geopolitical turmoil. Recent monthly data reinforces this trend, with official buyers resuming net purchases in April after recording net sales in March, adding 19 tonnes to reserves. Poland led the month with 14 tonnes, raising its 2026 total to 45 tonnes, while China added 8 tonnes, marking its 18th consecutive month of buying. As Fan noted, the percentage of respondents planning to increase their gold reserves rose to a record 45% this year from 43% in 2025, despite ongoing geopolitical turmoil. The survey, which received responses from 76 central banks - the highest participation level since its inception nine years ago - demonstrates the growing importance of gold in central bank reserve management strategies.
Central banks are implementing comprehensive diversification strategies beyond gold accumulation, with a particular focus on reducing US dollar exposure. The survey reveals that 74% of respondents expect US dollar holdings within global reserves to be moderately or significantly lower over the next five years, while gold's share is expected to increase accordingly. This strategic shift reflects central banks' growing recognition of gold as a geopolitical risk hedge and as an important component of reserve diversification policies. The World Gold Council noted that growing recognition of gold as a hedge against geopolitical risks has become a key factor driving central bank demand for the precious metal. Over eight in ten central banks acknowledged gold's value as a portfolio diversifier, which reinforces its appeal as a strategic reserve asset. The scramble to secure assets away from the dollar was also reflected in banks' souring sentiment towards the currency, with nearly 75% expecting its share to be lower five years from now. Reserve diversification remains the primary reason for buying gold, followed by the need for a stronger hedge against economic risks and concerns surrounding reserve-currency economies, with 31 of the 34 central banks planning to increase gold reserves citing diversification as a key motivation. Economic and geopolitical signals continue to shape reserve decisions, with interest rate levels topping the agenda at 92%, followed by geopolitical instability and inflation concerns. As per IMF data, US dollar's dominant global reserve currency status has been declining gradually, with respondents saying they expect this trend to continue.
Central banks are increasingly diversifying their gold storage locations globally, with established preferences remaining stable. According to the survey, the Bank of England remains the most popular vaulting location among 57% of respondents, followed by domestic storage at 49%, and the Bank for International Settlements at 16%. However, the latest data reveals a significant shift in storage strategies, with nearly half of central banks surveyed having relocated their holdings from the main gold markets to store domestically. The survey also revealed that central banks are planning further diversification, with 9% of respondents having increased domestic storage over the past year and 10% reporting diversification of overseas storage locations. Looking ahead, 7% of central banks plan to increase domestic storage in the coming 12 months, while institutions are also opting to actively manage their own gold reserves to enhance returns and mitigate potential risks. The growing importance of gold is also reflected in participation levels, with this year's survey attracting 76 responses, the highest on record and up from 73 last year, demonstrating that gold is becoming increasingly important within the official sector. The Swiss National Bank's preference rate fell to 6% from 12% in 2025.
Central banks are adopting strategic approaches to funding their gold acquisitions amid current market conditions. According to the survey findings, half of respondents indicated that new gold acquisitions would be funded through domestic purchase programmes in local currency, while 38% indicated they would finance purchases by selling existing reserve assets. This diversified funding approach reflects central banks' commitment to maintaining gold holdings while managing their overall reserve portfolios. The survey, which received responses from 76 central banks - the highest participation level since its inception nine years ago - demonstrates the growing importance of gold in central bank reserve management strategies. As Fan noted, the growing response rate is itself evidence that gold is becoming increasingly important within the official sector, with the number of conversations about gold among central banks having definitely picked up over the past one or two years. The survey shows that reserve managers also continue to value gold's traditional monetary characteristics, with 90% of respondents citing gold's performance during times of crisis as a major reason for holding the metal, while 84% pointed to its role as a long-term store of value and inflation hedge, and 83% highlighted its diversification benefits. Interest in gold is spreading across a broader group of central banks, with Fan noting that newer central banks are starting to emerge, pointing to countries such as Indonesia, Malaysia, Guatemala, and El Salvador that have recently entered the market or resumed purchases after years of inactivity. However, not all signals point higher, with bearish options bets targeting a 40% decline in gold prices by 2028, while Citigroup has trimmed its forecast to $4,000.
