For First Time in Nearly 30 Years, Foreign Central Banks Hold More Gold Than U.S. Treasuries

Moneymetals ^ | 29 Aug 25 | Mike Maharrey

[delta7]

For the first time since 1996, foreign central banks hold more gold than U.S. Treasuries as the world continues to de-dollarize.

Crescat Capital macro strategist Tavi Costa highlighted the crossover moment in a post on X, saying it is “likely the beginning of the most significant global rebalancings we've experienced in recent history.”

Central banks have been aggressively adding gold to their reserves over the last three years.

Last year was the third-largest expansion of central bank gold reserves on record, coming in just 6.2 tonnes lower than in 2023 and 91 tonnes lower than the all-time high set in 2022. (1,136 tonnes). 2022 was the highest level of net purchases on record, dating back to 1950, including since the suspension of dollar convertibility into gold in 1971.

To put that into context, central bank gold reserves increased by an average of just 473 tonnes annually between 2010 and 2021.

10 oz Silver Bars (Design Our Choice) 10 oz Silver Bars (Design Our Choice) Price & Buy At the same time, dollar reserves have been falling. As of the end of last year, dollars made up 57.8 percent of global reserves. That is the lowest level since 1994, representing a 7.3 percent decline over the last decade. In 2002, dollars accounted for about 72 percent of total reserves.

A recent JPMorgan note said this reveals the waning dependence on the U.S. dollar in trade that is being reflected in the gold market.

“The main de-dollarization trend in FX reserves, however, pertains to the growing demand for gold. … This increased demand has in turn partly driven the current bull market in gold, with prices forecast to climb toward $4,000/oz by mid-2026.”

On the other side of the coin, there is sagging demand for U.S. Treasuries.

Why De-Dollarization?

Why are so many countries spurning the dollar?

Many are concerned about the weaponization of the U.S. currency. In an article published by the Atlantic Council, Kimberly Donovan and Maia Nikoladze point out that “central banks that are worried about getting sanctioned, want to protect themselves from a potential global financial crisis, or both have been stacking up gold at record levels.”

There are also growing worries about the U.S. government’s fiscal irresponsibility. Earlier this month, the national debt pushed above $37 trillion, and there is no sign that the borrowing and spending will slow down any time soon.

Earlier this year, analyst Artis Shepherd called the sagging demand for U.S. Treasuries “red lights blinking.”

“The bond market is sending a message to the U.S. government that its spending is out of control and the reserve currency ‘privilege’ it has abused for the last 80 years is running out.”……..more….

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TOPICS:
KEYWORDS: banks; foreign; gold

[delta7]

There is no fixing senile Joe’s weaponizing the USD, the world has realized if they don’t do as the US says, they will be locked out of SWIFT, assets will be confiscated ( stolen), and they will be Sanctioned.

There is nothing President Trump can do about this, he knows we are in a pickle. His Stable coin scheme is a knee jerk reaction to find buyers for our unwanted debt instruments, which fund our governments day to day operations…..throw in the upcoming Debt budget battle in Congress on Sept 30th, and we have a disaster in the making.

Does anyone think the Democrats will come to any budget agreement? They most likely will vote against any of Trump’s proposals, possibly resulting in a government shutdown.

[goodnesswins]

Well...this time we may get REAL government shutdown...

[econjack]

Congress needs to stop spending our money to get themselves re-elected, and the average American has to come to grips with the concept that there is no such thing as a free lunch. Congress gets away with this because far too many Americans buy into the "Tax the Rich" and "Tax the Corporations".

Wake up, people!

The rich (income > $445,000/yr) already pay 74% of the total IRS collections while 50% of Americans (income < $46,000/yr) pay less that 3% of IRS collections. Yet, it is the rich who invest in this system, provides a rising standard of living through economic growth and creates jobs. As to corporations, where do you think the money comes from to pay those higher taxes? It's from you the consumer. So when you idiots march around with your signs with these slogans on them, they show me you don't know squat about economics or how the real world works and Congress is playing on your stupidity.

[delta7]

Well...this time we may get REAL government shutdown...
———————
The last one of any consequence lasted 45 days. As the Democrats are doing everything they can to sabotage Trump, a full blown shut down would suit them fine.

They had better think twice, a full blown shutdown would reveal how bloated our government still is….DOGE can jump in and do some real cutting, being a national emergency, they could cut deep to the bone and finally take care of business…..imagine reopening our government with 50 percent less bureaucracy?

[ComputerGuy]

Same here.

[Worldtraveler once upon a time]

--- "For the first time since 1996, foreign central banks hold more gold than U.S. "

An interesting assertion begins this article. But consider, our United States is 1) about four percent of the population of the globe, 2) based on various sources, about 30 percent of the global debt, and 3) about 25 percent of the global GDP or PPP, as one chooses to view things.

Nowhere in the above comparative and VERY approximate numbers, is this nation greater than half of anything. Therefore, the first sentence is silly, silly, silly. That the "foreign central banks hold more gold than U.S" -- the remainder of the world -- should be no surprise to anyone.

The bottom of this website's splash page states the MEDIA company's address is:

P.O. Box 2599 · Eagle, ID

Interesting, then, that this site wants your CURRENCY by selling METALS through its site.

It's M A R K E T I N G.....

[grumpygresh]

The government employees still get backpay after the shutdown is over so it accomplishes nothing. No one is fired.

[Worldtraveler once upon a time]

--- "Congress needs to stop spending our money to get themselves re-elected, and the average American has to come to grips with the concept that there is no such thing as a free lunch."

Yup.

But our political system is built on snake oil salesmen, promising they can "cure" what ails us. The fascinating problem for today is that this internet doesn't like to forget, so the political animals of today get their "yesterday I said this" repeated to them verbatim. (Includes Freepers....)

So which politician is trustworthy? This is actually a problem for Leftitsts ( and the Leftists costumed as RINOs ), Because their promises are coming back to haunt. So, Democrats are now saying stuff out loud. Their political sales pitches are failing, based on nothing more than some voter looking at their wallet and their bills and their neighbors' similar experiences.

[econjack]

I hope you are right.

[Alberta's Child]

I don’t disagree with anything you’ve posted there, but there’s no getting around the fact that there are warning signs all over the financial and economic statistics you can read on a daily basis:

1. Gold at $3,500/ounce
2. $37T+ in federal debt, and growing by the day
3. U.S. Treasury rates that are consistently higher than U.S. GDP growth (this is like borrowing money for a business at a 10% interest rate to grow your revenue by 5%)
4. A demographic collapse in the U.S. that makes future GDP growth even more difficult to achieve

[Socon-Econ]

You can’t eat gold or use it to produce things. What really matters is whether we have a free, growing economy and productive human capital.

[Uncle Miltie]

I just wish I could buy and sell in units of VTI.

[allendale]

The private citizens of India and China have far more gold than their central banks. They don’t trust their banks, currency or governments. Soon Americans will behave in a similar manner. America’s huge government debts, unfunded liabilities and private unpayable debt is rotting the dollar.

[Worldtraveler once upon a time]

Good morning. Your four points are well taken. What they point to is some sort of significant restructuring of the whole political and economic reality of our nation. Herb Stein's observation is screaming now, and the quasi-pernanent class is working overtime to pretend there no -- or little -- consequence for decades of idiocy.

This is why, it seems to me, we are inundated with so many "shiny object" things in today's media -- including selling "shiny objects."

The diagnosis seems clear. Like "two roads diverged in a yellow wood," one chooses a path and the other path is "not taken." Economically. Politically. Demographically.

My view ( and forecast ) is some sort of collapse will be answered with abrogation of government debt, which is about one quarter of all, as corporate -- which is taking out business after business no longer able to handle its individual debt service -- is about half of all worldwide.

That "financialization of everything" has wreaked havoc for decades, and has a history to tell us what the end of the story will be. As it has in the past, over and over again.

We individually need play with caution, have no debt and therefore no debt service requirement, and vote out the debt-loving bastards. On a local basis as on a national basis.

As another comment on this thread says, there is no free lunch. It just looked like that when the liars painted all their pretty pictures.

Best wishes.

[Worldtraveler once upon a time]

--- "What really matters is whether we have a free, growing economy and productive human capital."

Exactly. How many politicians these days actually beleive that?

[delta7]

You can’t eat gold
——————-
You can’t eat electronic E money or paper dollars either…but you can hold it in your hand with no counter party risks..….ie, hacking, bankruptcies, bank failures, power outages, currency debasement, government collapses, etc….Gold protects your Wealth against ALL forms of financial manipulation, fraud, crashes and defaults…..for 5,000 years and counting.

[goodnesswins]

Yup...my thoughts went to DOGE also.

[MinorityRepublican]

They had better think twice, a full blown shutdown would reveal how bloated our government still is….DOGE can jump in and do some real cutting, being a national emergency, they could cut deep to the bone and finally take care of business…..imagine reopening our government with 50 percent less bureaucracy?

Which is why I doubt a shutdown will happen.

[delta7]

The government employees still get backpay after the shutdown is over so it accomplishes nothing. No one is fired.
—————-
That was the past, no one can predict just how long and how bad a full blown shutdown can be. Chances are unlikely it would last long, as the Fed and Treasury have a lot of “ tools” to use….remember what the wicked witch Yellen did?

[shooter223]