Dateline: FRANKFURT, June 11, 2025 – Gold has overtaken the euro as the second-largest global reserve asset, accounting for 20% of total reserves, according to the European Central Bank (ECB).
- Gold now represents 20% of global reserves
- Euro has dropped to 16% of reserves
- Record central bank purchases continue to rise
Market reaction & context
Gold’s ascendancy is underscored by a nearly 62% surge in price since January 2024, as central banks increasingly turn to the precious metal amid global uncertainty. This shift comes as the euro’s share has declined, reflecting broader economic concerns within the Eurozone.
Detailed analysis
The ECB’s annual report indicates that gold’s market price performance has significantly bolstered its appeal among central banks, leading to record purchases that further solidified its status as a preferred reserve asset. The euro’s standing as the second-most important reserve asset has been compromised as the ongoing financial climate nudges investors towards tangible assets like gold for stability.
At the end of 2024, gold’s share of global official reserves climbed to 20%, surpassing the euro’s share of 16%. Meanwhile, the US dollar continues to dominate global reserves with a substantial 46% share.
Outlook / management quote
“The increasing diversification strategy of central banks demonstrates their preference for gold as a safeguard against market volatility,” said a spokesperson from the ECB. “This trend underscores gold’s enduring value in uncertain economic times.”
Conclusion
The ongoing demand for gold as a reserve asset illustrates not only a shift in investment strategy among central banks but also a growing recognition of the precious metal’s role as a hedge against market unpredictability. Investors will closely monitor these trends as they unfold in the coming months.
Not investment advice. For informational purposes only.