Gold is reclaiming its throne as the ultimate safe haven. While traditional assets like U.S. Treasurys, the Japanese yen, and the Swiss franc have long been considered safe during crises, they’re losing ground fast. Central banks across the globe are piling into gold. According to the World Gold Council (WGC), these banks expect to hold even more gold and fewer U.S. dollars in their reserves over the next five years.

The shift isn’t just talk. Central banks added over 1,000 tons of gold to their reserves in each of the last three years. That’s more than double the average of the previous decade. The reason is clear: gold doesn’t come with the risks tied to government debt or currency devaluation. Unlike fiat money, it’s free from political interference. In short, it’s a financial escape hatch in an increasingly unstable world.

“Gold may be reclaiming its role as the ultimate safe haven, but the deeper signal is a global crisis of trust in fiat currencies. As central banks race to hedge against political and economic instability, it’s only a matter of time before we see a major cryptocurrency emerge as the de facto universal stable currency—decentralized, borderless, and immune to sovereign risk.” — Tajinder Virk, Founder, Finvasia

 

Gold Beats Treasurys and Yen as the True Safe Haven

Gold has outperformed every major safe haven asset in 2025. Spot gold prices are up 30% so far this year, racing past the Japanese yen, Swiss franc, and even U.S. Treasurys. At one point, gold hit an all-time high of $3,500 an ounce. Meanwhile, the yen and Swiss franc only gained about 8% and 10% against the dollar, respectively. U.S. bonds, once rock-solid, saw yields spike and prices fall in April after political drama and credit downgrades.

Investors are growing uneasy. They’re no longer sure about the future of the dollar or the Treasury market. Gold, by contrast, is “nobody’s liability,” as experts put it. It isn’t tied to any single economy or government. That independence is its edge. As the global financial order becomes harder to predict, gold’s apolitical and stable nature makes it a winner.

Why Central Banks Are Doubling Down on Gold

The World Gold Council’s latest survey reveals a powerful trend. A record 95% of central banks believe that global gold reserves will increase over the next year. Meanwhile, more than 70% expect to cut their dollar holdings. The reason? Rising geopolitical tensions, uncertain trade policies, and inflation risks. The U.S. Federal Reserve (FED) might start cutting rates, but central banks aren’t banking on a dollar rebound.

Emerging markets are leading the charge. About 69% of developing economies now see gold as a better reserve asset than the dollar. The Bank of England remains a top storage site, but what matters more is who’s buying—and they’re buying a lot. This isn’t just a hedge. It’s a calculated move to prepare for a world where dollar dominance is no longer guaranteed.

CITIGroup Cautions: Is Gold’s Rally Running Out of Steam?

Not everyone sees gold’s future in a golden light. Analysts at CITIGroup think the rally may cool down soon. They project that gold could drop below $3,000 an ounce in the coming quarters. Why? A few reasons: weaker investment demand, stronger global growth, and expected rate cuts by the FED. According to CITI’s base case, gold could settle around $2,500–$2,700 by mid-2026.

But this outlook is not set in stone. CITI still gives a 20% chance that gold could surge to new highs if trade wars, geopolitical conflicts, or stagflation hit harder. For now, the outlook depends on what happens with the FED, U.S. fiscal policy, and global economic stability. So while the rally might slow, the underlying risks that fueled it haven’t disappeared.

Gold vs. the Yen: Why the Yellow Metal Still Wins

The Japanese yen, once a go-to safe haven, is struggling. Japan’s central bank hasn’t raised rates as aggressively as others, keeping them at just 0.5%. That’s made the yen less attractive compared to other assets. Though it’s gained about 8% against the dollar this year, investors remain cautious. Rising Japanese bond yields suggest falling demand, adding more pressure.

In contrast, gold keeps rising. It doesn’t pay interest like bonds or sit in a bank account, but it also doesn’t rely on government promises. The WGC emphasizes this key point—gold has no counterparty risk. You own it outright. As uncertainty grows in both Western and Asian markets, more investors are betting on gold over government-issued assets like the yen or Treasurys.