In a calibrated reserve management move, the Banque de France has liquidated its remaining gold stored in the US and rebuilt its holdings in Europe. The transition, completed between July 2025 and January 2026, marks the end of France's long-standing practice of holding part of its reserves at the Federal Reserve Bank of New York.
By executing 26 staggered transactions during a period of record-high gold prices — peaking near $5,600 per ounce — the French central bank generated an estimated €12.8 billion (or around $14.7 billion) capital gain. This sharply altered its financial position, turning a €7.7 billion (around $8.8 billion) loss in 2024 into a €8.1 billion (around $9.3 billion) net profit in 2025.
French authorities have framed the move as a technical upgrade. Governor François Villeroy de Galhau described it as part of a broader effort to replace older, “non-standard” gold bars with bullion that meets current international specifications.
Instead of physically transporting gold across continents, the bank adopted a sell-and-rebuy strategy — offloading US-held reserves and purchasing equivalent, higher-grade bars within Europe. This approach avoided logistical costs and political sensitivities typically associated with repatriation, while improving the quality and liquidity of its holdings.
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Strategic Undertones Hard to Ignore
While the Banque de France maintains that the move is operational in nature, it inevitably draws comparisons with France's historic push for monetary independence in the 1960s under Charles de Gaulle.
Unlike the overt and politically charged gold repatriation of that era, the current shift has been executed through market transactions. Still, the outcome is greater control over national reserves, achieved without disrupting markets.
France's move comes amid a broader shift in how central banks manage gold reserves. Germany continues to hold a significant portion of its gold in the US, with growing domestic pressure for repatriation, whereas Italy faces similar calls to bring reserves closer to home. According to the World Gold Council, 59% of central banks now prefer domestic storage, up from 41% in 2024.
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