Global Economy — 2026-04-27

Gold Overtakes US Treasuries as Largest Foreign Reserve Asset for First Time Since 1996

World Gold Council data show foreign central banks now hold gold approaching $4 trillion, edging above their roughly $3.9 trillion in US Treasuries for the first time since 1996. Gold ended 2025 up nearly 70%, crossing $4,500 per ounce in a late-year rally that continued into the first week of January 2026. The WGC forecast 1,000 tonnes in net central bank purchases for 2025; Mining.com reported central banks had sustained fast-paced buying for four years despite high prices. JP Morgan, in a note cited by Mining.com, linked the shift in part to US domestic polarization, writing that it "could jeopardize its governance, which underpins its role as a global safe haven."

Analysis
The four-year, ~1,000-tonne annual accumulation streak marks a structural policy shift; gold's reserve share would have grown in a flat-price environment. JP Morgan attributes the divergence to US governance polarization rather than yield differentials (per a single MINING.COM report drawing on WGC data, consistent with IMF figures), signaling the dollar's safe-haven premium is being repriced on political grounds, a dynamic harder to reverse than a rate cycle. Central banks will likely sustain net purchases above 800 tonnes through end-2026, though the composition shift may partly reflect price-driven portfolio rebalancing: existing holdings surged while elevated rates suppressed incentives to roll Treasuries, implying the trend reverses sharply on a gold correction.

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Gold overtakes US bonds as largest foreign reserve asset - MINING.COM