Central Banks Ditch Dollars & Stack Gold: The Great Reserve Shake-Up of 2025

Global central banks are making a power move—dumping dollars and hoarding gold like modern-day dragons. This isn’t your grandpa’s monetary policy.

Why the shiny pivot?

With the USD losing its stranglehold on global trade, gold’s timeless appeal is back in vogue. No inflation reports, no Fed whispers—just cold, hard metal. Some call it prudence. Others call it panic.

The irony? Banks are flocking to an asset with zero yield while crypto—the ultimate hedge—keeps getting sidelined. Old habits die hard, even when they’re paved with 19th-century thinking.

One thing’s clear: when institutions lose faith in fiat, the game changes. Whether gold’s the hero or a temporary fix? That’s the trillion-dollar question.

Central Banks To Cut Down On US Dollar Holdings

The US dollar hegemony is currently on a transformative path as it continues to gain new competitors and challenges in its wake. As the Middle East tensions escalate with the Israel-Iran war crisis deepening rapidly, the central banks around the world may expedite their Gold purchases, pivoting towards the evergreen bullion in times of acute crisis.

Per a recent survey conducted by the World Gold Council, bullion is once again shining brightly in the asset domain, compelling central banks to stock up on gold to balance their reserves.

The global war crisis and the fear of sanctions, coupled with the concern regarding the eroding status of the dollar are three conditions that are pushing global banks to stockpile gold at a rapid pace.

Moreover, 95% of respondents of the World Gold Council expect global banks to target the yellow metal amid deepening geopolitical unrest in the next 12 months.

At the same time, three-quarters of respondents expect US dollar holdings to get cut as banks rush towards bulking up on gold.

Gold Repatriation Is Trending

As the world economies revise their strategies amid escalating war tensions in the Middle East, the process of accessing gold in times of crisis has now taken center stage. This development has led many central banks to repatriate gold assets back to their countries, enabling easy access in times of acute economic distress.

Per the Financial Times, India has repatriated nearly 100 tons of gold from the Bank of England for a more secure access to the asset during bleak economic times.