Europe Shifts Gold Reserves from US Amid Rising Geopolitical Tensions

The Netherlands' central bank, De Nederlandsche Bank (DNB), has relocated part of its gold reserves from North America to London. The move follows similar actions by France and Germany, citing increasing geopolitical tensions as a reason for the shift.

Between March and August, DNB transferred 86 tonnes of its approximately 313 tonnes held in the US and Canada to the Bank of England in London. This change has altered DNB's reserve distribution, with London now holding 32.1% of its gold reserves, up from 18.1%. North America's share decreased to 18.5%, down from 31.3%.

DNB stated that the relocation was made 'in view of increasing geopolitical unrest' to ensure the gold is 'readily available for use in a crisis situation.' Governor Olaf Sleijpen emphasized the necessity of strengthening resilience and preparedness amid ongoing trade disputes and military conflicts, including tensions between the US and Canada.

The Dutch relocation has sparked concerns about potential economic shocks. However, experts suggest it's more about adapting to a volatile global landscape. The move aligns with a broader trend of increasing gold purchases by central banks, which have averaged annual acquisitions of 1,000 tonnes over the past four years, a significant rise from the previous decade's average of 500 tonnes per year.