Gold has formally replaced U.S. Treasury bonds as the world's leading reserve asset, a landmark shift confirmed by a European Central Bank report.
This transformation is driven by years of sustained central bank purchases and a historic near-doubling of gold prices over the past two years.
The European Central Bank's Tuesday report indicates gold constituted 27% of global central bank reserve assets by the end of 2025, a significant increase from 20% the previous year.
Over the same period, the share of U.S. Treasury bonds fell from 25% to 22%, while the proportion of euro-denominated reserves remained steady at 15%.
Central bank reserves are highly liquid assets used to support national currencies, meet international payment obligations, and buffer against financial instability.
The shift in the composition of these reserves reflects a growing trend among nations to seek alternatives to the U.S. dollar.
This process has accelerated since 2022, following U.S. sanctions against Russia and the freezing of its dollar reserves in the context of the Ukraine conflict.
European Central Bank President Christine Lagarde noted in the report that ongoing geopolitical tensions continue to fuel strong gold purchases by central banks.
Global central banks now hold over 36,000 tonnes of gold, approaching the peak of 38,000 tonnes held during the Bretton Woods era when the dollar was pegged to gold and exchange rates were fixed.
Gold's ascendance over U.S. Treasuries, the traditional cornerstone of dollar reserves, has also been propelled by the metal's soaring price, which reached a new high above $5,500 per ounce in January 2026.
Despite this shift, European Central Bank data shows that U.S. dollar assets overall still constitute the largest share of global reserves at 42%.
In 2025, global central banks made net purchases of 850 tonnes of gold, a slight moderation from the average annual pace exceeding 1,000 tonnes seen over the preceding three years.
Since 2022, China, Poland, Turkey, and India have been among the largest national buyers increasing their gold reserves.
However, in 2025, the stablecoin company Tether emerged as the largest single purchaser, acquiring over 100 tonnes.
Turkey accumulated 220 tonnes of gold following the outbreak of the Russia-Ukraine war in 2022, but sold or lent out 130 tonnes after the onset of the Iran war in early 2026, in what the ECB described as one of the largest reserve drawdowns in recent years.
The ECB report also highlighted that the euro's international role has seen a "steady rise" over the past decade.
Last year, the issuance of international debt denominated in euros grew by 30% to nearly €1 trillion, a record high, while net investment by international investors into euro area assets reached €850 billion, pushing portfolio inflows close to their peak since the currency's creation.
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