Gold has rarely glittered so brightly. The precious metal now trades above $4,100 (£3,390) an ounce, and analysts at Société Générale think it could climb as high as $5,000 (£3,769) by the end of 2026. Investors continue to pour into exchange-traded funds backed by bullion, while central banks keep adding to their hoards.
In an era of fractious geopolitics, stubborn inflation and jittery markets, the oldest of safe havens has reasserted its appeal.
The latest data from the World Gold Council show that global reserves have risen to an unprecedented £3.6trn, up nearly half since the end of 2024. Much of that increase reflects not so much a surge in quantity as in valuation. Gold’s price has jumped by almost 48% this year alone, from £2,079 to £3,072 per ounce by mid-October. That has handed central banks a windfall: the value of Britain’s gold reserves, for instance, has risen by £9.9bn since January to £30.7bn, despite the Bank of England not buying a single bar in nearly two decades.
UK lags in the gold stakes
Britain’s gold pile now stands at 316 tonnes: roughly 4.5 grams per person, or one small coin each. That puts the country 45th globally in gold per capita, well behind Switzerland, where every citizen, on paper, could claim the equivalent of 37 coins. The Swiss sit atop the global leaderboard for gold wealth per head, while America still reigns supreme in total holdings, with 8,133 tonnes worth about £803bn.
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Not everyone has been content to sit on their gilded laurels. Poland has emerged as the world’s most enthusiastic buyer, adding 67 tonnes so far this year after setting a record in 2024 with 89 tonnes of net purchases. Its stash is now worth £50.9bn, up 70% year on year.
Turkey, China and several Gulf states have also been busily adding to their vaults, seeing gold as a hedge against both inflation and the dollar’s fluctuating fortunes. Others, sensing an opportunity to lock in profits, have trimmed their holdings.
The United Kingdom, by contrast, has been a model of inertia. Its last recorded transaction was a modest sale of 407 kilograms in March 2006 — an almost nostalgic reminder of the infamous “Brown’s Bottom” era, when the Treasury offloaded nearly half the country’s reserves at prices barely a quarter of today’s.
Gold becoming more important to forex reserves
Yet even without fresh buying, the rise in prices has transformed the metal’s significance within Britain’s foreign-exchange reserves. In July, gold accounted for around 17% of their total value; by year-end that share could approach 20%, purely through revaluation.
Société Générale’s analysts argue that, if prices reach $5,000 an ounce, the metal’s allure could grow stronger still. Central banks would be sitting on record nominal gains, reinforcing gold’s role as an anchor of perceived stability amid fiscal strain and political turmoil. That would delight holders like Poland but may prompt awkward questions in places, such as Britain, where policymakers have long preferred currencies and securities over bullion.
Gold, as ever, inspires both fascination and regret. Those who bought early gleam with satisfaction; those who sold too soon can only polish their excuses.
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