Central Banks Diversify Gold Reserves Amid Geopolitical Risks

The location of central banks' gold reserves is changing as they increasingly prioritize control and risk management. According to the World Gold Council's 2026 Central Bank Gold Reserves Survey, London remains the dominant foreign vault for official gold, with 57% of surveyed central banks using the Bank of England for gold custody. However, this share has fallen from 64% in the previous survey.

Central banks are shifting towards domestic storage, with 49% of respondents reporting some gold at home and 9% increasing their domestic gold storage over the past year. This trend reflects a desire for direct control and reduced exposure to foreign jurisdictions during geopolitical or financial crises.

The French Banque de France is an example of this shift, selling US-held gold and buying high-standard bars in Europe to gain greater control over its reserve. India has also moved a substantial part of its reserve stock towards domestic vaults, with about 22% of its total holdings remaining overseas.