Gold vs dollar: Why the world’s richest are rushing to buy before the next big spike

Gold has surged past US Treasuries in global central bank reserves for the first time in nearly 30 years — signaling a bold, long-term bet on bullion that every investor should be watching.

The “Emperor of Assets” is back on its throne. Gold now makes up 20% of central banks’ foreign exchange reserves — eclipsing the euro’s 16% share and overtaking US Treasuries for the first time since 1996.

The shift isn’t just symbolic. It marks a deep loss of confidence in fiat currencies, especially the US dollar, which still holds 46% of global reserves but is shrinking. The dollar has already dropped nearly 10% in 2025.

Central banks have gone on a buying spree, adding over 1,000 tonnes of gold annually since 2022 — double the pre-2020 average. That relentless demand has sent gold prices skyrocketing to an all-time high of $3,592 per ounce, up 36% this year alone.

For investors, the message is clear: gold isn’t just a hedge — it’s becoming the core.

Goldman Sachs estimates that if even 1% of the $30 trillion US Treasury market shifts to gold, prices could climb to $5,000 — a 43% surge from current levels. In India, ICICI Bank has set a bullish target of ₹1,25,000 for mid-2026, up from today’s record ₹1,07,920.

This bullish setup comes amid growing distrust in the Fed’s independence and rising geopolitical tensions. Peter Schiff, chief economist at Europac, flagged potential Supreme Court moves that could weaken the Fed, saying this is already pushing up gold and bond yields.

With US jobs data weakening and rate cuts likely on the horizon, gold’s momentum shows no sign of fading. De-dollarisation, driven by trade wars and rising debt, could supercharge the trend.