Central banks cut dollar reliance as gold gains ground in reserves

Central banks around the world are continuing to increase the weight of gold in their international reserves amid rising economic and geopolitical uncertainty, while long-term confidence in the US dollar as the world’s main reserve currency appears to be weakening.

The Central Bank Gold Reserves Survey 2026 by the World Gold Council, conducted with YouGov, found that 84% of participating central banks believe gold will account for a higher share of total national reserves over the next five years, up from 76% in last year’s survey.

At the same time, 74% of respondents expect the share of the US dollar in total reserves to decline over the same period, although the dollar remains the world’s dominant reserve currency.

The survey reflects broadly similar views among both advanced economies and emerging market and developing economies (EMDEs).

Most central banks still plan to buy gold

The trend of accumulating gold is expected to continue in the short term. The survey found that 89% of respondents believe global central bank gold reserves will increase over the next 12 months.

In addition, 45% said their own central bank is likely to increase gold holdings over the next year, close to 43% in the 2025 survey and the highest level recorded since the survey began.

EMDE countries remain a key driver of gold accumulation, with around half of respondents in this group expecting to add gold to their reserves, while the other half expect holdings to remain unchanged.

War and geopolitical risks support gold demand

The survey found that economic and geopolitical factors remain important variables in central banks’ reserve management decisions.

Some 92% of respondents identified interest-rate levels as the most influential factor in reserve management, followed by geopolitical instability and inflation concerns.

The report said geopolitical instability moved ahead of inflation concerns in this year’s survey, reflecting the impact of the conflict in Iran.

Among EMDE respondents, concerns over geopolitics and inflation were clearly higher than among advanced economies. Some 95% viewed geopolitical developments as an important factor, while 84% continued to place importance on inflation risks.

Gold stands out as a safe-haven asset in crises

When asked why they hold gold, 90% of respondents said gold’s performance during times of crisis was the most important factor, the highest level recorded since the survey began.

Meanwhile, 84% said gold plays a role as a store of value, while 83% said it helps diversify reserve portfolios.

Among emerging market and developing economies, 92% of respondents viewed gold’s ability to preserve value during crises as an important reason for holding it, compared with 81% among advanced economies.

In addition, 85% of EMDE respondents viewed gold as a hedge against geopolitical risk, compared with 56% among advanced economies.

The survey also found that 76% of central banks still manage gold separately from other reserve assets.

The main reason is that gold is seen as a strategic asset, with 75% of respondents selecting this as a reason, up from 64% the previous year.

The most popular form of gold for both purchases and holdings remains London Good Delivery bars. Some 62% of respondents chose them as the main form for purchases, while 93% selected them as the main form for holdings.

Central banks diversify gold storage locations

Although the Bank of England remains the most popular gold storage location, used by 57% of respondents, the survey found that more central banks are beginning to diversify where they store their gold.

Over the past 12 months, 10% of respondents said they had diversified overseas storage locations, up from 2% in the previous year.

Another 9% said they had increased domestic gold storage.

Looking ahead to the next 12 months, 9% of central banks plan to diversify overseas storage locations further, while 7% plan to increase domestic gold storage.

The 2026 survey, conducted from February 5 to May 19, 2026, reflects continued confidence in gold as a reserve asset, with 76 central banks taking part.

The World Gold Council said macroeconomic uncertainty, interest rates, inflation and geopolitical risks remain key factors encouraging central banks to focus more carefully on diversification and reserve management.

In an increasingly volatile and unpredictable global environment, gold continues to be recognised for its safety, liquidity and potential returns — core investment objectives for central banks. The latest survey suggests that global central bank demand for gold is likely to remain high in the future.