Some Central Banks Have Been Selling Their Gold. That Doesn’t Mean You Should Too.
TLDR:
- Gold suffered its biggest monthly price decline in nearly 13 years in March 2026
- Some central banks have shifted from buyers to sellers — but this is crisis-driven liquidation, not a structural shift
- Central banks still bought 863 metric tons of gold in 2025, remaining historically high
- Gold’s role as a liquid asset during currency crises proves its value as a reserve asset
Central Banks Selling Gold: Crisis-Driven, Not a Structural Shift
Gold suffered its biggest monthly price decline in nearly 13 years, and some central banks have shifted from being buyers to sellers — but that actually proves the precious metal can be more valuable to investors than it’s ever been. The narrative that central banks have abandoned gold is simply not supported by the data. Instead, what we’re seeing is crisis-driven liquidation by a handful of countries under severe currency pressure. It is not a structural shift away from gold reserves.
Jan Skoyles, the U.K.-based head of marketing at precious-metals dealer GoldCore, put it best in a YouTube video: “Gold is the asset that held its value well enough to be worth liquidating. That is not a weakness in gold. That is the entire point of gold.” Her argument cuts to the heart of what makes gold unique among reserve assets — it’s not just a store of value, but a source of immediate liquidity when countries need dollars most.
Central-bank gold buying was one of the strongest pillars underneath gold’s bull market, and it was a big part of the reason why gold prices began a relatively steady climb in 2022 to repeatedly reach fresh record highs. Gold futures reached their latest all-time high on January 29, 2026, trading as high as $5,626.80 an ounce. Central banks purchased over 1,000 metric tons of gold each year in 2022, 2023, and 2024 — roughly double the average over the preceding decade. While buying slowed in 2025, it remained historically high at 863 metric tons.
The Middle East Conflict Changes the Picture
The start of the current war in the Middle East, with the U.S. and Israel launching military attacks on Iran on February 28, seemed to change all that. The most active gold futures lost nearly 11% in March, marking their worst monthly percentage loss since June 2013. Gold for June delivery settled at $4,679.70 on April 2 — down $947.10, or almost 17%, from the intraday record high in January.
So gold hasn’t been the best place for investors to park their money against a backdrop of a war that has fueled a rally in oil prices, worries about inflation, and uncertainty in the global economy. Instead, the precious metal has offered something that may be even better — a source of liquidity. When oil spikes, every energy-importing economy on earth suddenly needs more dollars to pay for it. Europe, Turkey, Japan, India — they’re all scrambling for dollar liquidity at the same time. The euro is down 7% against the dollar since the conflict started, while the Turkish lira has hit fresh record lows 11 times since late February. So when your currency is collapsing and you need dollars now, you sell the most liquid, nondollar reserve asset you have. You sell your gold.
Who Is Selling and Why
Edmund Moy, a former director of the Treasury Department’s U.S. Mint and senior IRA strategist for precious-metals distributor U.S. Money Reserve, cautions against drawing any long-term trend from central-bank sales because each one has different reasons to sell. There are only a few central banks that have either sold some of their gold or intend to do so in the near term. This is not unusual and, overall, central banks have been and will continue to be net buyers of gold.
In February 2026, global central banks bought 19 metric tons of gold, with Poland buying 20 metric tons, while Turkey and Russia were among the sellers. That compares to average monthly purchases of 26 metric tons in 2025. The People’s Bank of China, arguably the single most important driver of the central-bank buying trend since 2022, appears to have officially paused its gold purchases, though Chinese authorities have been known to understate their actual accumulation.
Turkey has drawn down about 60 metric tons from its reserves since the conflict began — about $8 billion worth of gold — to defend the lira. It wasn’t Turkey deciding that gold is overvalued; this was emergency currency defense. Poland has proposed monetizing its roughly 550-metric-ton gold reserve to generate 48 billion zloty, or about $13 billion, for defense spending. Meanwhile, Russia has been liquidating its gold reserves since 2025, raising about $2.4 billion, with its holdings now at a 40-year low. This is about war financing, not portfolio repositioning.
Buying the Dip: Why Private Investors Are Stepping In
Despite what has appeared to be some weakness in gold, it’s hard to ignore the precious metal’s achievements in the past few years. Gold has made a pretty dramatic transformation over the last five years from fringe diversification to core asset in the eyes of high-net-worth individuals and even institutional investors. If it’s good enough for central banks’ reserves, it’s good enough for everyone.
The major driving forces behind the rally remain in place: global debt explosion, currency devaluation, de-dollarization, central-bank buying, broad geopolitical instability, mounting domestic political tensions, and policy uncertainty. Private investors seem to agree — they have seized on gold’s price drop because this sudden retreat gives buyers the chance to reset the clock back before January’s historic price spike.
BullionVault’s Gold Investor Index rose to 60.7 in March, up 2.3 points from a month earlier to reach its highest reading since August 2020. That means demand for gold among investors actually climbed even as prices fell. The breadth of demand says that gold remains a compelling investment in today’s uncertain and increasingly dangerous world.
Our Take
The central bank gold selling story is being misread by the market. Yes, Turkey, Poland, and Russia have been liquidating gold — but these are countries under acute financial pressure, not rational investors trimming positions. They’re selling gold precisely because it held its value, making it the logical asset to convert to cash when currencies collapsed.
For retail investors, this is actually a signal of gold’s strength, not weakness. Gold did exactly what it was designed to do: provide a liquid buffer when countries needed emergency funding. Meanwhile, private investor demand is surging as evidenced by the BullionVault index hitting its highest since 2020.
The real story isn’t that central banks are abandoning gold — it’s that gold proved its worth as a crisis asset during the very crisis that triggered the selling. The dip should be seen as a buying opportunity for long-term investors, not a reason to exit.
