European Central Banks Flee North American Gold Reserves Amid Geopolitical Uncertainty

European central banks are shifting their gold reserves out of North America and into London's vaults, citing increasing geopolitical uncertainty. The Netherlands is the latest to make this move, relocating 86 tonnes of its gold holdings from the US and Canada between March and August.

The Dutch central bank, De Nederlandsche Bank (DNB), sold 59 tonnes in New York and bought an equivalent amount in London, avoiding a physical transfer. The remaining 27 tonnes were physically moved from the US and Canada to Zeist, then on to London.

DNB's Governor Olaf Sleijpen said the move was necessary to 'strengthen our resilience and preparedness' amid rising tensions and trade disputes. London was chosen due to its status as a major global trading centre and the Bank of England's reputation as one of the world's largest gold custodians.

This shift is part of a larger trend, with central banks accumulating an average of 1,000 tonnes of gold per year over the past four years, compared to 500 tonnes previously. The World Gold Council notes that storing gold domestically can be costly for smaller central banks, making London's vaults an attractive option.