More central banks increasing domestic gold storage, diversifying overseas vaulting: survey

[SINGAPORE] A rising number of central banks are increasing their domestic bullion storage and diversifying their overseas gold vaulting locations, going by the findings of the Central Bank Gold Reserves Survey 2026 undertaken by the World Gold Council (WGC) and released on Tuesday (Jun 16).

The survey drew 76 responses between Feb 5 and May 19. The majority were received after the start of the Middle East conflict in late February, which triggered a rally in oil prices and drove gold prices down.

The yellow metal was trading at around US$4,348 as at 9 pm on Tuesday, down roughly 20 per cent from its peak near US$5,500 in January.

In the last 12 months, 9 per cent of the respondents bumped up their domestic gold storage, up from 5 per cent in the year before; 10 per cent diversified their overseas storage locations, up from 2 per cent in the preceding year.

When asked to look ahead, 7 per cent of the respondents said that they plan to increase domestic storage, and 9 per cent plan to diversify overseas vaulting locations in the coming year.

Political risk

Fan Shaokai, head of the Asia-Pacific (excluding China) and global head of central banks at the WGC, told The Business Times that these moves are “mostly driven by political risk”.

He said: “Political considerations have been top of mind for central banks for a number of years now. It makes sense that they want to diversify more … to spread out some of that risk a little bit more, or maybe some of them are looking to move the gold back home.”

Fan cited the example of the Reserve Bank of India, which moved around 100 tonnes of gold back to its domestic vaults last year.

Singapore, which is looking to deepen its gold trading infrastructure, announced on Monday that it intends to offer gold vaulting for central banks by October this year.

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Referring to this move, Fan explained: “Central banks are very much looking at where they’re storing their gold and what the best practice should be. I think that offering a jurisdiction like Singapore – especially if the Monetary Authority of Singapore itself is offering a custody solution – would probably be a very welcome development by a lot of central banks.”

However, central banks will likely treat the diversification and repatriation of their gold reserves as a measured shift rather than a sudden pivot.

Fan added: “I don’t think you’re going to see all the gold in New York or London go somewhere else all of a sudden. I think it’ll be incremental changes, but I do think it will be a persistent trend.”

He noted that while the repatriation of central bank gold is not novel, it has become more of a discussion point in recent years amid mounting geopolitical tension.

The council’s research has found the Bank of England to be the most popular vaulting location, followed by domestic storage and the Bank for International Settlements.

Continued buying

A record 45 per cent of the reserve managers surveyed said that they expect to raise their own institutions’ gold holdings over the next 12 months, up two percentage points from the year before.

Just over half the respondents (54 per cent) said their holdings would remain unchanged; 1 per cent anticipated a decline.

The WGC noted that 93 per cent of respondents reported already holding gold, up from 81 per cent a year ago.

Asked about the drivers for gold ownership, a record 90 per cent of the respondents cited its performance during times of crisis. The top answers also included the metal’s long-term store of value and portfolio diversification. Among emerging market and developing economy respondents, 85 per cent cited gold’s role as a hedge against geopolitical risk as their top reason to hold a stock of gold.

Fan said: “This year’s survey sends a clear message: Central bank demand for gold remains on an upward trajectory. ... What stands out is the shift in how central banks think about gold. Fewer see it as a legacy holding; more see it as an active, strategic allocation in an environment defined by geopolitical uncertainty and reserve diversification.”