Gold Overtakes Euro as Second-Largest Global Reserve Asset, Says ECB
Gold has surpassed the euro to become the world’s second-most important reserve asset for central banks, according to the European Central Bank (ECB). By the end of 2024, gold accounted for about 20% of global official reserves, overtaking the euro’s 16%, while the U.S. dollar remains dominant at 46%.
This shift is driven by record-high gold purchases by central banks, surging gold prices, and a strategic move to diversify away from traditional currencies amid rising geopolitical tensions. Central banks, especially in countries like Poland, Turkey, India, and China, have been accumulating gold at historic rates, with purchases exceeding 1,000 tonnes for the third consecutive year. This trend reflects a growing preference for gold as a hedge against inflation, currency risk, and potential sanctions.
The ECB notes that gold’s appeal lies in its stability, liquidity, and independence from any single issuer or government, making it a trusted store of value during periods of global uncertainty. This marks a historic turning point in the international financial system, with central banks’ gold holdings now approaching levels last seen in the 1960s Bretton Woods era
