NextFin News - Central banks are still treating the dollar as the system’s anchor, but a new survey suggests they are less willing than before to let it dominate reserve portfolios without question. In the World Gold Council’s 2026 survey of reserve managers, 45% said they expect their own institutions to increase gold holdings over the next 12 months, while 89% said they expect global official gold holdings to keep rising. The survey was conducted between 5 February and 19 May 2026, with 76 central-bank responses, and it lands in a year when reserve managers are openly rethinking how much of their balance sheets should sit in one currency.
The headline is not that central banks are abandoning the dollar overnight. It is that the reserve conversation has shifted from passive dependence to active diversification. That matters because reserve managers move slowly, but their decisions are sticky: once a central bank broadens its mix, the change can persist for years and quietly reshape demand across currencies, sovereign bonds and bullion. The dollar still has the deepest market, the most liquid collateral pool and the widest payments network. But the survey suggests those advantages are increasingly being weighed against a different set of risks — sanctions exposure, fiscal uncertainty, geopolitical fragmentation and the appeal of assets that sit outside the fiat system altogether.
The broader official-sector backdrop reinforces that point. The European Central Bank said in June that the euro remained the world’s second most important currency and that its international role increased moderately in 2025. In the same review, the ECB said the euro accounted for 20.2% of global foreign exchange reserves at Q4 2025, underscoring that reserve diversification is happening around the edges even if no single rival has come close to displacing the dollar. The message from policy institutions is not that the dollar is finished. It is that reserve portfolios are becoming more plural.
That pluralization is most visible in gold. The World Gold Council survey found a record share of central banks expecting to add to their own gold holdings, while a separate June release said 89% of reserve managers expect global central-bank gold holdings to keep increasing over the next year and only 1% expect a decline. That is a major signal because gold does not compete with the dollar in the same way the euro or yen does. It competes with the idea that reserves should be concentrated in claims on foreign governments at all. For reserve managers who care about political neutrality, crisis protection and long-duration hedging, bullion is no longer a fringe allocation.
Put differently, the survey is a vote for optionality. It does not say central banks have lost faith in the dollar’s market depth. It says they are increasingly unwilling to rely on that depth alone. And once that mindset spreads, the official sector does not need to trigger a dramatic break in the dollar to change the market. It only needs to keep trimming concentration at the margin.
What The Survey Is Really Saying
The most important detail in the survey is not the 45% figure by itself. It is the consistency of the response pattern: reserve managers are looking to increase gold, and they expect the broader official sector to do the same. That tells you the diversification impulse is not confined to one region or one balance-sheet strategy. It is becoming a global reserve-management theme.
That matters because reserve managers are not day traders. They do not need to forecast quarterly returns to alter their portfolios; they are managing liquidity, confidence and political resilience over multi-year horizons. When those institutions shift preferences, they tend to do so with a long lag and with little fanfare. The effect can therefore be underestimated in real time. A survey is not a transaction log, but in the reserve world it often comes before the transactions show up in the data.
The ECB’s June review provides a useful anchor for that interpretation. The euro’s 20.2% share of global foreign exchange reserves at Q4 2025 is still far behind the dollar’s position, but it is enough to show that the reserve system has already moved beyond a purely bilateral dollar-versus-everything-else framework. Reserve managers can diversify without making a single giant bet on an alternative super-currency. They can spread across the euro, sterling, yen, Swiss franc and gold, reducing the dollar’s centrality one allocation decision at a time.
The World Gold Council said the research was conducted between 5 February and 19 May 2026 and drew 76 responses from central banks around the world.
That response count matters too. Seventy-six central banks is not a trivial sample for a survey of a highly concentrated market segment. It cannot replace official reserve data, but it is large enough to capture the mood of the official sector at a time when geopolitical risk and reserve composition have become more entwined than they were before the pandemic and the Russia sanctions regime.
The key takeaway is that reserve managers are no longer treating diversification as a theoretical exercise. They are signaling it as a planning assumption.
Why Gold Keeps Showing Up In Reserve Portfolios
Gold has re-entered the reserve conversation because it solves a problem currency diversification does not. A second reserve currency can still be exposed to the same sovereign-credit and payment-system structure that governs the first. Gold sits outside that architecture. It has no issuer, no default risk and no need for cross-border settlement infrastructure. That is why it becomes more attractive when the world looks less predictable.
The World Gold Council survey captures that shift directly. A record 45% of reserve managers said they expect to increase their own gold holdings over the next 12 months, and 89% said they expect global official gold holdings to continue rising. The survey does not imply that central banks are replacing dollars with bullion one-for-one. It implies that gold is increasingly being used as a complementary reserve asset, one that can sit alongside the dollar rather than challenge it head-on.
That distinction matters. A one-for-one substitution story is too dramatic and too simplistic. The more accurate story is portfolio layering. Reserve managers can keep the dollar for liquidity, add euros or yen for variety and hold more gold for crisis insurance. Each added layer slightly reduces dependency on the dollar without forcing an abrupt break.
That layered approach also helps explain why dollar dominance has been more durable than the headlines sometimes suggest. The dollar is not just a reserve currency; it is a funding currency, a collateral currency and the backbone of the global payments and derivatives system. Those uses create inertia. But inertia is not immunity. Once reserve managers decide that a portion of their balances should live elsewhere, the dollar loses a small piece of the structural support that has kept it so central for decades.
In its June review, the European Central Bank said the euro remained the world’s second most important currency and that its international role increased moderately in 2025.
The ECB’s framing is important because it confirms that diversification is not a fringe thesis. The official European institution responsible for the currency is openly describing an incremental expansion in the euro’s international role. That does not mean the euro is poised to overtake the dollar. It means reserve managers have more room to spread risk than they used to.
Why The Dollar Still Holds The Center
Despite the survey’s signal, the dollar’s structural advantages remain formidable. Reserve managers care about the ability to deploy assets quickly in stress, and on that front the dollar still offers unmatched depth. Treasury markets remain the most important sovereign-bond market in the world. The dollar is the dominant invoicing currency for trade and the primary currency for cross-border funding. Those functions are self-reinforcing and hard to dislodge.
That is why the survey should not be read as a countdown to dollar decline. A central bank can want less dollar concentration without finding a realistic replacement for everything the dollar does. The most likely outcome is therefore not a collapse in dollar usage but a gradual broadening of reserve mixes. That sort of change can be significant over time even if it is invisible in any single quarter.
The official sector’s behavior around gold reinforces the same point. Gold is gaining because it is not a payment instrument and does not have to compete directly with Treasury bills or swap lines. It sits in a separate category — one that looks increasingly useful when reserve managers want insurance rather than yield. That makes gold a natural beneficiary of uncertainty, but it also means its rise is not the same thing as an outright bet against the dollar.
The ECB’s data are a reminder that diversification has limits. The euro’s 20.2% share of global foreign exchange reserves at Q4 2025 is meaningful, but it also shows how difficult it is to challenge the dollar’s scale. The reserve system can become more multi-currency without becoming less dollar-centered overnight. That middle state is where it appears to be moving.
For markets, that middle state matters more than a dramatic headline. It implies that the dollar can remain strong while still facing a slow structural headwind from official diversification. It also suggests that any reserve-driven bid for Treasuries is likely to be more selective, more price-sensitive and more dependent on relative risk than it was in the past.
What To Watch From Here
The next confirmation point will be whether official reserve data continue to show the dollar’s share drifting lower in slow motion while gold’s role keeps expanding. If the survey is accurate, future reserve reports should show the same pattern: no dramatic break, but steady diversification away from concentration.
Policy language will matter too. When central banks and supranational institutions describe a currency as one important reserve asset among several, they are not just describing the present. They are legitimizing a broader portfolio logic for the official sector. That can be enough to keep diversification going even when markets are calm.
For the dollar, the risk is not immediate dislodgment. It is attrition. Every incremental increase in gold or non-dollar reserves reduces the system’s dependence on a single currency at the margin. That is a slow process, but the reserve world is built on slow processes. The survey does not show the dollar losing its crown. It shows central banks getting more comfortable with the idea that the crown no longer has to be worn alone.
The most important implication is that the reserve system is evolving from concentration to redundancy. The dollar remains the first choice, but it is no longer the only one that central banks are willing to plan around.
Explore more exclusive insights at nextfin.ai.
