Gold is having its moment in the spotlight. According to estimates from the World Gold Council, central banks are set to buy increasing amounts of the precious metal while scaling back on the US dollar. Gold is regaining its dazzling allure!
The driving force behind this surge in gold purchases by global regulators is growing skepticism about the stability of the greenback. Against this backdrop, central banks are expected to aggressively reduce dollar reserves and ramp up their gold holdings, the WGC suggests.
Beyond concerns about the greenback’s future, policymakers are also wary of escalating geopolitical conflicts and tightening sanctions. These three factors are pushing banks toward record gold purchases. As a result, the price of gold has surged 30% since the start of 2025. Central banks highlight gold’s effectiveness during crises, citing its immunity to default risk and its hedge against rising inflation.
The metal’s rally accelerated further following the recent flare-up in the Iran-Israel conflict. Last week, gold prices briefly hit $3,430 per ounce, underscoring its status as the ultimate safe haven.
