Gold has officially surpassed U.S. Treasury bonds to become the largest global reserve asset, according to a new report from the European Central Bank. The report indicates that by the end of 2025, gold's share of central bank reserve assets worldwide rose to 27%, a significant jump from 20% a year earlier. In contrast, the share of U.S. Treasury bonds fell from 25% to 22% over the same period. The price of gold has nearly doubled in the past two years, briefly surpassing a historic high of $5,500 per troy ounce in January of this year.
This shift in the global reserve landscape carries profound implications for markets. The traditional role of U.S. Treasuries as the anchor of international dollar reserves has been challenged. Meanwhile, the structural support for gold demand—sustained central bank purchases—is unlikely to reverse in the near term. Eurozone assets also saw substantial capital inflows, with international investors directing a net €850 billion into the region, a figure approaching peak levels seen since the euro's creation.
Gold's Share Soars, Ending Treasuries' Historic Dominance
The European Central Bank report shows that gold's proportion in global central bank reserves leapt from 20% to 27% in a single year. The share of U.S. Treasury bonds, meanwhile, declined from 25% to 22%. This marks the first time gold has overtaken U.S. debt to become the single largest component of reserve assets.
It is worth noting that U.S. dollar-denominated assets as a whole still account for 42% of total reserves, remaining the largest currency bloc. The share of euro-denominated reserve assets held steady at 15%.
Gold's rise is driven both by continuous central bank buying and the metal's substantial price appreciation. European Central Bank President Christine Lagarde noted in the report, "Ongoing geopolitical tensions continue to underpin strong central bank demand for gold."
Central Bank Gold Holdings Approach Bretton Woods Peak
Data from the European Central Bank shows that global central banks currently hold over 36,000 tonnes of gold, nearing the levels seen at the height of the Bretton Woods system. At that time, central banks held approximately 38,000 tonnes, with the U.S. dollar pegged to gold and other currencies fixed against the dollar.
In 2025, global central banks were net purchasers of approximately 850 tonnes of gold, a slight slowdown from the previous three years when annual net purchases exceeded 1,000 tonnes. Since 2022, the largest accumulators of gold reserves have been, in order, China, Poland, Turkey, and India.
A notable new development is that stablecoin company Tether emerged as the single largest buyer of gold in 2025, purchasing over 100 tonnes for the year, surpassing the purchases of most sovereign central banks.
Geopolitics Accelerates De-Dollarization, 2022 Sanctions a Turning Point
The deeper changes in reserve asset composition are rooted in nations' strategic intent to find alternatives to the U.S. dollar. The European Central Bank report notes that this trend accelerated noticeably from 2022 onward—the year the U.S. froze Russia's dollar reserves using sanctions, prompting many countries to reassess the potential risks of holding dollar assets.
The case of Turkey illustrates how geopolitics can directly influence gold reserve dynamics. Since the outbreak of the Russia-Ukraine conflict in 2022, Turkey has accumulated 220 tonnes of gold. However, in early 2026, following the outbreak of the Iran war, Turkey sold or lent out approximately 130 tonnes of gold, an action the European Central Bank described as "one of the largest reserve mobilizations in recent years."
The European Central Bank report also points out that the euro's international role has expanded "gradually but steadily" over the past decade. In 2025, the issuance of international debt denominated in euros grew by 30%, reaching a "historic high" of nearly €1 trillion. Net inflows from international investors into eurozone assets reached €850 billion, pushing foreign portfolio inflows to "near peak levels since the creation of the euro."
Although the global share of euro-denominated reserve assets remained unchanged at 15%, the capital flow data suggests that euro assets are gaining broader international recognition, with their appeal rising against a backdrop of a challenged U.S. dollar dominance.
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