There’s been a major shift in global financial trends this year. As highlighted in the latest European Central Bank report (June 2025), gold has officially overtaken the euro to become the second-most held reserve asset in the world. Its share has climbed to around 19%, while the euro has slipped to about 16%. The U.S. dollar, however, continues to hold the top spot, making up nearly half of global reserves.
A big reason behind this change is how central banks have been behaving lately. Their appetite for gold has grown significantly, and now they account for more than one-fifth of the world’s total gold demand. This is quite a leap compared to ten years ago. The push seems to have been triggered by ongoing geopolitical tensions, inflation fears, and doubts around the reliability of major currencies — especially after the conflict in Ukraine.
For many countries, gold has always been a sort of safety net. It’s trusted during tough times, particularly when other currencies become unstable. Nations like Russia and China, wary of future sanctions or trade blocks, have been steadily adding gold to their reserves, looking for alternatives to the traditional dominance of the U.S. dollar and the euro.
Interestingly, gold reserves are now at their highest point since the 1960s. Ever since global inflation started rising in the post-2022 period, the demand for gold has been climbing fast. It has even reached record-high prices in recent months, showing how valuable it has become again in global finance.
That said, some analysts believe this might be the peak. With central banks reaching their comfort limits and gold prices becoming more volatile, we may see this aggressive buying trend slow down. Countries could shift their focus towards balancing their reserves rather than aggressively stockpiling gold.
