Central banks around the world have once again made gold the star of the monetary stage in 2025. Over the past year, the headlines have told a familiar story. Governments, particularly in emerging markets, have accelerated their purchases of bullion, and the collective impact is reshaping the gold market in ways that directly affect investors and the wider economy.
In 2025, emerging economies continue to lead the charge in reserve building. China’s People’s Bank, for instance, lists its official holdings at 2,264 tonnes as of June, but given how rarely they update figures, the real number could be higher with analysts estimating unreported purchases could push the figure closer to 2,500 tonnes. On the other side of Europe, Poland has increased its stockpile dramatically by over 57% in just five years, to nearly 360 tonnes as of August 2025. Nations such as Turkey, with reserves at 591 tonnes after adding 75 tonnes this year alone, and India, surpassing 876 tonnes in mid-2025, aren’t far behind with their own aggressive buying campaigns. Places like Singapore and several Gulf states, including Saudi Arabia with 323 tonnes, also feature prominently in this modern gold rush.
But why this renewed interest in gold? First, there’s the desire to diversify away from the US dollar, a trend that has grown as geopolitical risks multiply. Central banks in emerging markets now allocate an average of 20% of their reserves to gold, up from 15% a decade ago. Without directly saying goodbye to traditional reserve assets, central banks use gold to carve out a little more independence in the global financial system. Gold also brings a sense of stability, acting as a reliable hedge against inflation and allowing countries to weather the storms of currency volatility or shifting interest rates.
This year, central bank demand is stronger than almost any period in recent memory. Experts estimate that official sector purchases will top 900 tonnes in 2025 alone, the fourth straight year of heavy buying. In fact, for the first time since 1996, central banks now hold more value in gold than in US Treasuries. This is a striking signal about their view of currency risk, the future of monetary policy, and the direction of the global economy.
The consequences of these policies extend far beyond central bank vaults. Gold hit an all-time high in October 2025, passing £3,200 per ounce, with roughly 17% of all above-ground stocks, approximately 36,000 tonnes, now in the hands of official institutions. These are numbers which were hard to imagine only a few years ago. Supply shortages, elevated prices, and heightened volatility are the new normal, with central bank buying accounting for nearly 25% of global gold demand this year. Private investors and funds are increasingly interested in bullion, riding the wave set in motion by central bank activity.
According to the latest survey of central bank leaders, a record 95% of respondents expect gold’s role in reserves to increase over the coming years, and 76% plan to boost their own allocations within the next five years. Banks across emerging markets, often the most active buyers, see bullion not simply as an investment, but as an insurance policy against the uncertainties of 2025 and beyond.
This trend is setting the tone for global markets, influencing everything from spot prices to the way individual investors plan their portfolios. For anyone watching the evolution of monetary policy, keeping tabs on central bank gold strategies is more than a curiosity – it’s essential to understanding what comes next for gold, currencies, and the wider financial world.
