In a significant reshuffling of global financial order, gold has overtaken the euro to become the second-largest reserve asset by market value worldwide, trailing only the US dollar. The European Central Bank (ECB) confirmed this development in its annual review of the international role of the euro, attributing the shift to a record-breaking wave of central bank gold purchases and the rise of global geopolitical instability.

The ECB report, released on June 11, reveals that central banks increased their gold holdings by more than 1,000 tonnes in 2024 – double the average annual increase observed over the past decade. This brought total official gold holdings to approximately 36,000 tonnes, approaching the levels last seen in 1965 during the waning years of the Bretton Woods monetary system.

The dramatic resurgence in demand, combined with a near 30% surge in gold prices throughout 2024, elevated the precious metal’s standing in global reserves. By the end of the year, gold constituted roughly 20% of global official reserves by market value, eclipsing the euro, which accounted for 16%.

The price of gold soared to record highs, breaching $3,500 per troy ounce, driven not only by increased institutional demand but also by investor anxiety over international instability, inflationary risks, and shifting alliances in global trade and politics.

“This stockpile, together with high prices, made gold the second-largest global reserve asset at market prices in 2024 – after the US........

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