Central Banks Accelerate Gold Accumulation as Dollar Hegemony Fractures
BRICS nations now control 17.4% of global official gold reserves while cutting dollar holdings, signaling a structural shift in the international monetary order.
Central banks purchased 1,237 tonnes of gold in 2025—more than the annual mine production of several mid-sized producing countries—as geopolitical shocks and sanctions risk accelerated a structural retreat from dollar-based reserves.
The surge, documented by OnlineGold.org citing World Gold Council data, marks the third consecutive year of purchases exceeding 1,000 tonnes annually, a pattern that emerged immediately after Russia’s $300 billion in foreign exchange reserves were frozen in 2022. BRICS+ nations now hold more than 6,000 tonnes of gold—17.4% of global central bank reserves, up from 11.2% in 2019—and accounted for 663 tonnes of purchases in the first nine months of 2025 alone, worth approximately $91 billion.
The acceleration coincides with three overlapping shocks: the Iran-Israel conflict that erupted on February 28, persistent Ukraine war operations, and mounting concerns about U.S. fiscal sustainability as federal debt surpassed $36 trillion. Gold reached an all-time peak near $5,600 per ounce in January 2026 before correcting to $4,656 by April 7, according to Fortune—still up 27% from the start of the year.
The 2022 Catalyst
Russia’s exclusion from international financial systems fundamentally rewired central bank risk assessment. Before 2022, sovereign gold purchases averaged roughly 500 tonnes annually. Since the freeze, annual accumulation has doubled—and the composition has shifted decisively toward non-Western buyers. Mining Weekly reports that BRICS+ nations purchased more than 50% of all gold bought by sovereigns between 2020 and 2024.
China’s People’s Bank extended its purchasing streak to 16 consecutive months as of February 2026, per FinancialContent. Brazil divested $61 billion in U.S. Treasury securities in 2025 while doubling its gold holdings, making gold the second-largest component of its reserves by early 2026. Poland bought 20 tonnes in February alone, bringing its reserves to 570 tonnes—31% of total holdings—with a stated target of 700 tonnes, according to the World Gold Council.
Dollar Reserve Share Erosion
The dollar’s share of global foreign exchange reserves fell to 56.92% in Q3 2025, down from 57.08% the previous quarter and well below the 70%+ levels that prevailed for decades, according to IMF COFER data. The decline is gradual but unidirectional, tracking a widening perception gap between U.S. monetary dominance and fiscal sustainability.
A World Gold Council survey found that 73% of global central bankers expect the dollar’s reserve share to decrease over the next five years—the highest percentage on record. More critically, 43% plan to increase gold holdings, and 95% of reserve managers expect global gold reserves to continue rising through the end of 2026. Zero percent indicated any intention to reduce holdings, per FinancialContent.
“A phenomenon we’ve been seeing in the last few months is new central banks, or central banks that have been inactive or absent from the gold market for a long time, entering the gold market. I think that might be a trend that will continue into 2026.”
— Shaokai Fan, Global Head of World Banks, World Gold Council
Price Floor and Structural Demand
The World Gold Council projects 750–850 tonnes of central bank purchases in 2026, still well above pre-2022 norms. That volume represents roughly 20% of annual global mine supply, absorbed as a one-directional flow regardless of price. This creates a structural floor under gold markets that did not exist a decade ago, when central banks were net sellers.
| Period | Annual Purchases | Share of Mine Supply |
|---|---|---|
| Pre-2022 | ~500 tonnes | ~12% |
| 2022-2025 | 1,000+ tonnes | ~24% |
| 2026 (proj.) | 750-850 tonnes | ~20% |
The February 28 Iran-Israel escalation—which killed Supreme Leader Ali Khamenei in opening strikes and expanded into a Lebanon conflict with over 1,400 casualties by early April—has reinforced safe-haven demand. Unlike investment flows, which reverse with sentiment, official sector buying persists through volatility. Gold’s 27% surge in January reflected this bifurcation: speculative capital chased momentum while central banks absorbed supply regardless of entry price.
Multipolar Monetary Architecture
Russia and China alone account for 4,634 tonnes of BRICS+ gold reserves—74% of the bloc’s total. Both nations have systematically reduced dollar exposure while accumulating bullion, a pattern Northern Miner describes as reflective of concerns about sanctions weaponisation and dollar dominance.
The freeze of Russian reserves in 2022 demonstrated that foreign exchange holdings denominated in adversarial currencies carry confiscation risk in geopolitical crises. Gold, held physically within sovereign territory, eliminates counterparty exposure. This distinction has become central to reserve allocation decisions among non-aligned states.
The shift is not merely reactive. BRICS+ nations are constructing reserve frameworks that assume reduced dollar liquidity in a multipolar order. The group’s 6,000+ tonne stockpile represents a credible foundation for alternative settlement mechanisms, particularly if backed by commodities or basket currencies rather than single fiat units.
U.S. fiscal dynamics compound the urgency. With federal debt exceeding $36 trillion and annual deficits running $1.8–2.2 trillion, the trajectory raises questions about long-term dollar stability that central banks cannot ignore. Gold offers finality—no counterparty risk, no devaluation through monetary expansion, no sanctions exposure.
What to Watch
The World Gold Council’s 2026 projection of 750–850 tonnes assumes no further geopolitical shocks. If the Iran-Israel conflict widens or U.S.-China tensions escalate, actual purchases could exceed 1,000 tonnes for a fourth consecutive year. Poland’s stated 700-tonne target and China’s unbroken buying streak suggest upside risk to current forecasts.
Watch for IMF COFER data in Q2 2026, which will capture Q4 2025 and Q1 2026 reserve composition. Any acceleration in dollar share decline would confirm that the trend is intensifying rather than stabilising. Central bank disclosure practices also matter—China and Russia report reserves sporadically, meaning official figures likely understate actual holdings.
Gold’s correction from $5,600 to $4,656 reflects profit-taking and speculative unwinding, not a reversal in official sector demand. If prices stabilise above $4,500 through Q2 despite continued central bank absorption, it would signal that structural buying has reset the market’s equilibrium range—a recalibration with lasting implications for currency stability and inflation expectations as the multipolar monetary order takes shape.