Why Central Banks Are Buying Gold, and What It Means for You

Gold ads love to point at central banks as proof you should buy too. We'll cover how much they've actually bought, the reasons they give, what the data say about the dollar, and why their choices make a weak guide for yours.

Why does a central bank hold gold at all?

A central bank manages a country's money. In the U.S., that's the Federal Reserve. Many also keep reserves, a sort of national savings account holding foreign currencies, other countries' government bonds, and gold. When their own currency needs support or a crisis makes imports hard to pay for, that's the money they reach for, and just having it on hand keeps confidence up.

Gold's been in those reserves a long time, and most of what's sitting in vaults today is a leftover from the era when currencies were tied to gold and a country's gold pile was the thing that stood behind its money. What's new is the pace: in recent years, a lot of central banks have been adding to it faster.

How much have they been buying?

The most widely quoted figures come from the World Gold Council, a research and market development group funded by gold mining companies. That funding is worth remembering. Its data draw on reports to the IMF plus its own estimates, and they get revised.

In 2025, the World Gold Council reported that the National Bank of Poland was the largest buyer for the second year running, adding about 102 tonnes. Kazakhstan, Brazil, and Turkey were among the other big buyers.

For scale, a tonne is about 32,150 troy ounces. So 2025 was a step down from the three years before it, but only a step: buying still ran well above the 2010 to 2021 average.

The reasons they give

Each year the World Gold Council surveys central banks with the polling firm YouGov. The 2026 edition, published in June 2026, drew 76 responses.

• 90% said gold's performance during times of crisis was a relevant reason to hold it.
• 84% pointed to gold's role as a long-term store of value.
• 83% pointed to gold as a portfolio diversifier.
• Among emerging-market central banks, 85% saw gold as relevant as a hedge against geopolitical risk, compared with 56% of central banks in advanced economies.
• 45% said they planned to increase their own gold holdings over the next 12 months.

Remember who's asking: an industry group, surveying the central banks that chose to answer.

Diversification

Most reserves sit in a few currencies, mainly the U.S. dollar and the euro. Gold isn't tied to any one government. That's the appeal. So for a central bank, adding gold spreads reserves into something that doesn't hinge on another country's policies.

Sanctions

On February 28, 2022, after Russia invaded Ukraine, the U.S. Treasury barred U.S. persons from transactions with Russia's central bank. Other countries did the same, and that effectively froze a big share of Russia's foreign reserves held abroad.

A lot of analysts think this made some countries, especially those with tense relations with the U.S. or Europe, keener on gold stored inside their own borders. The survey's tilt toward geopolitical risk among emerging-market central banks fits that view. They rarely say so outright, though, so it's hard to measure.

Is the world moving away from the dollar?

"De-dollarization" is the idea that countries are shifting away from using and holding U.S. dollars. Gold marketing brings it up constantly. The numbers don't all point the same way, so here they are side by side.

Signs the dollar's role is shrinking

• The International Monetary Fund's COFER data, which track the currencies central banks report holding, show the dollar's share of reserves falling over time. A Federal Reserve analysis puts the peak at about 72% in 2001.
• Central banks have been buying gold at a historically fast pace since 2022.
• In the World Gold Council's 2026 survey, 74% of central banks said they expect the dollar's share of global reserves to be lower in five years.

Signs it's still dominant

• The dollar still made up about 57.1% of reported reserves in the first quarter of 2026, according to the IMF, up slightly from about 56.4% at the end of 2025. The euro came a distant second at about 20%, and China's renminbi was about 2%.
• A July 2025 Federal Reserve note found the dollar's reserve share has been "basically unchanged since 2022." It also found the dollar is on one side of about 88% of global currency trades.
• The same note concluded that the dollar's international use is little changed over the past five years.

Where does that leave things? The dollar's share has slowly declined over about 25 years, and IMF research found much of that shift went to smaller currencies like the Canadian and Australian dollars, with some going to China's renminbi. It still makes up more than half of reported reserves. And short-term wiggles in the share can come from exchange rates moving, not just from actual buying and selling.

Neither side tells you what gold's price will do. We don't make predictions about the dollar or gold.

Why their buying isn't your buy signal

"If central banks are buying, I should too." It's a tempting thought. We'd push back on it for five reasons.

Different goals

A central bank manages national reserves on a time frame of decades. It doesn't pay a mortgage, cover medical bills, or take required minimum distributions. Say you're sixty-eight and drawing a set amount from your IRA each month: you might need to sell some of your savings within the next few years, whatever gold happens to be doing that week.

Different costs

They buy huge amounts at close to wholesale prices. You don't. Individuals buying coins or bars pay dealer markups, and a gold IRA adds storage and custodian fees on top, which our guide to gold IRA fees and cost calculator add up for you.

A slice of a big pile

Most of the buyers hold gold alongside far larger piles of currencies and bonds. Their purchases say more about diversifying at the edges than about putting a big share into gold.

They've sold, too

In the 1990s, several European central banks were selling gold. In 1999, a group of them signed an agreement announced by the European Central Bank to cap their combined sales at about 400 tonnes a year. Their behavior shifts over the decades. It isn't a forecast.

Buying and prices don't line up

Central banks bought more than 1,000 tonnes in 2022, yet gold rose only about 0.6% that year, according to annual returns compiled by Prof. Aswath Damodaran of NYU Stern. In 2025, central bank buying slowed to about 863 tonnes. Gold rose about 66%. Lots of forces move gold's price, and central banks are just one of them.

So what should you take from it?

Central bank buying is a real trend and one reason gold's drawn so much attention. It tells you how some large institutions are handling their reserves. It doesn't tell you how much gold, if any, belongs in your retirement plan.

Start with your own situation instead: how soon you'll need the money, what income you have, how much a price swing would rattle you. Picture opening a year-end statement and seeing your gold down by a quarter. Would you hold on? Or sell? Our guides on how much gold some retirees hold and how gold has behaved in crises can help, and the gold vs. stocks tool puts gold's long-term record next to stocks and a balanced portfolio.

Common questions

How much gold did central banks buy in 2025, and who bought most?

About 863 tonnes, according to the World Gold Council. That's less than the more than 1,000 tonnes a year bought from 2022 through 2024, but still well above the 2010 to 2021 average of about 473 tonnes. Poland's central bank was the largest buyer, adding about 102 tonnes, with Kazakhstan, Brazil, and Turkey also among the larger buyers.

Is the U.S. dollar losing its reserve currency status?

Its share has slipped slowly. It was about 72% in 2001 and about 57% in early 2026, based on IMF data and Federal Reserve analysis. It's still by far the largest reserve currency, and nobody can reliably predict how that'll change.

Does the Federal Reserve buy gold?

U.S. official gold is held by the Treasury Department, and the U.S. hasn't been among the buyers in recent years. The largest buyers the World Gold Council named for 2025 were Poland, Kazakhstan, Brazil, and Turkey.

Should I buy gold because central banks are?

We can't tell you what to buy. A central bank has different goals and costs than you do, and it plans over decades, not the few years in which you might need to sell. Base the decision on your own needs and timeline, and on how well you'd sit through a big price swing.

We base our guides on primary sources such as the IRS, the Department of Labor, and federal regulators. Read our editorial policy. Spot an error? Tell us.