Central bank gold moves are about repatriation, not liquidation – StoneX’s O’Connell
While the recent headline may give the impression that central banks are selling off some of their gold reserves, the gold has merely changed location in response to the rising perceived risk of sanctions and seizure, according to Rhona O'Connell, Head of Market Analysis for EMEA & Asia at StoneX.
“News headlines last week captured the public's imagination with the reports of the Netherlands' central bank repatriating gold from North America into Europe,” wrote Rhona O'Connell, Head of Market Analysis for EMEA & Asia on Wednesday.
O'Connell noted that between June 2025 and January 2026, the Banque de France sold 129 tonnes of its gold reserve in New York gold – representing less than 5% of its official sector holdings of 2,437 tonnes – before buying it back in Europe, effectively moving the gold to Paris.
“Headlines at that time gave the misleading impression that France was selling its US gold holdings, and not mentioning that it was being replaced in Europe, i.e. a de facto location swap,” she said. “The Dutch have followed suit and, for the most part, using the same mechanism although only 59t were involved in a location swap (into London this time), but a further 27t were physically moved from New York and Ottawa into Zeist in the Netherlands (thereby presumably obviating the need to recast into LGD bars).”
The risk of U.S. sanctions has been cited as the major driver for these moves. “The acceleration is widely attributed to the freezing of approximately $300 billion in Russian central bank reserves by Western nations in 2022, which signalled to non-aligned central banks that dollar-denominated reserves can be frozen or seized, whereas domestically vaulted gold cannot,” O'Connell wrote. “And of course, - again in the headlines recently - the Bank of England is holding Venezuelan gold that will remain frozen until (if) the UK Government recognises the current Venezuelan regime.”
“The timing of the recent request for return and reports that the US was involved in the negotiations, suggest a potential link with the US-Venezuela transaction,” she added.
On Sept. 2, the Dutch central bank, De Nederlandsche Bank (DNB), announced it had moved 86 of its 313 tonnes of gold from the U.S. and Canada to London.
The DNB said it moved the gold to strengthen its crisis preparedness and improve the liquidity and tradability of its reserves. The central bank said that its gold reserves held in New York and Ottawa cannot be utilized as quickly and directly in such a situation.
The central bank said that keeping a larger share of its gold reserves in London will strengthen the function of gold as an “anchor of trust.” It added that gold is seen as the ultimate reserve asset because it is ideally suited to hedge against extreme systemic risks.
“With this relocation, we have improved the tradability of our gold reserves. We expect that we will never need to use them, but we do need to strengthen our resilience and preparedness,” said DNB Governor Olaf Sleijpen.
Before the move, the DNB held nearly 31% of its gold domestically, about 18% in London, more than 31% in New York and nearly 20% in Ottawa.
Following the transfer, 32% of its official reserves are now held in London, with New York and Ottawa holding 18.5% each.
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