Gold Surpasses U.S. Treasuries as Global Central Banks Redefine Trust

For the first time since the 1990s, global central banks now hold more gold than U.S. Treasuries — a monumental shift reflecting deep changes in how the world views safety, liquidity, and trust in the financial system. According to Barchart data, this historic crossover signals a major reallocation from paper-based assets to tangible reserves, marking a turning point in global finance.

The World Gold Council reported that central banks bought a net 19 tonnes of gold in August 2025, following 10 tonnes in July. With the year on pace for nearly 900 tonnes in purchases, this will be the fourth straight year that demand has doubled the long-term average. The Kobeissi Letter noted that central banks have been net buyers for 16 consecutive years — the longest streak on record — after decades of selling before 2010.

Analysts point out that this gold accumulation extends beyond inflation hedging. Researcher Sunil Reddy linked the surge to the Federal Reserve’s shrinking reverse-repo balances, where banks park excess cash. As that liquidity vanished, investors sought “hard money” that can’t default. Gold, he said, is evolving into “pristine collateral — the asset of last trust.”

The U.S. government’s rising debt costs, with nearly 23 cents of every revenue dollar going to interest, are further eroding foreign confidence in Treasuries. Since the 1970s, major fiat currencies have lost up to 90% of their value against gold. Yet, even as gold shines, digital assets like Bitcoin are gaining ground. Crypto analyst Lark Davis noted that Bitcoin’s 3% rise amid gold’s recent pullback could signal a brewing rotation toward “digital gold.”

In this new financial era, where central banks — the ultimate issuers of fiat money — are stacking gold, the message is clear: trust is migrating from promises to tangible value.