(Mike Maharrey, Money Metals News Service) In a move that netted a nice capital gain, the Banque de France (BdF) sold the remainder of its gold held in the U.S. and replaced it with higher-quality bars purchased in Europe.
The move significantly upgraded the quality of the French central bank’s gold reserves. And while officials won’t talk about it out loud, it also gave the U.S. a little less control over French finances.
France has the fourth-largest gold reserves in the world.
The French central bank upgraded 129 tonnes of gold that was stored in New York. The move impacted about 5 percent of the country’s 2,437-tonne gold reserves. In the process, the central bank realized a gain totaling nearly $13 billion thanks to the higher gold price.
“In 2025 and at the start of 2026, while the volume of gold reserves remained unchanged, the Banque de France had to align a residual portion (5%) with technical guidelines, resulting in a significant realized currency gain. This exceptional foreign exchange income totaled EUR 11 billion for 2025.”
The BdF unloaded “non-standard” gold bars of varying purity and size. The central bank used the proceeds to purchase new gold bars that meet international reserve standards for weight, purity, and certification.
Think of it as exchanging “junk silver” for pure .999 silver coins.
Notably, a large percentage of U.S. gold reserves is made up of these non-standard bars.
According to the London Bullion Market Association (LBMA), gold bars must contain 350 to 430 fine troy ounces and have a minimum fineness of 995.0 parts per thousand to be acceptable for international settlements.
Having sold the last of its gold in New York, the entirety of France’s gold is now safely inside French borders. According to a French news agency, the central bank still holds 134 tonnes of non-standard bars and coins. It plans to upgrade the remainder of its holdings by 2028.
Not a Political Move?
French central bank officials insist pulling the remainder of its gold out of the U.S. was not a political move. BdF governor Francois Villeroy de Galhau said he made the decision to sell the non-standard gold held in New York to “upgrade reserve quality” and that it was more convenient to simply sell the metal stored in New York and buy higher quality gold in Europe rather than transporting and refining the existing bars in the U.S.
However, I would bet dollars to donuts that the move was at least partially motivated by politics.
In fact, France moved most of its gold out of the U.S. in the 1960s, and it was 100 percent motivated by politics.
Skeptical of U.S. monetary expansion and worried it would ultimately ruin the value of the currency, President Charles de Gaulle secretly repatriated 3,000 tonnes of the country’s gold from the U.S. between 1963 and 1966. The operation even had a code name – Vide-Gousset, French for “emptying the pocket.”
Many economists believe the French move was the death knell for the Bretton Woods system. Under the scheme established in 1944, the dollar became the primary global currency. Other currencies were linked to the dollar, and the dollar was convertible to gold. Just a few years after France brought the bulk of its gold home, President Richard Nixon ended the convertibility of the dollar to gold, ushering in the era of fiat money.
Today, many countries are again wary of the dollar’s outsized role in global finance due to the U.S.’ weaponization of the currency and America’s fiscal malfeasance.
Over the last several months, a movement to repatriate Germany’s gold held in New York has sprung up.
The German central bank opted to store significant amounts of gold in New York to keep it far away from the Soviet Union during the Cold War. As an article in Fortune pointed out, “The country’s close ties with the U.S., which has historically held up the Western World order, made the Fed an obvious resting place for the commodity.”
With the U.S. aggressively using economic pressure as a foreign policy tool, the wisdom of storing German gold in New York no longer seems quite so obvious to many Germans.
For instance, a leading German economist and former head of research at the Bundesbank says the central bank should move all of the gold stored in the U.S. back to Germany. Emanuel Mönch said it’s “too risky” to keep Germany’s gold reserves in the United States.
European Taxpayers Association (TAE) head Michael Jäger was even more blunt, saying U.S. demands to control Greenland should “concentrate minds.”
“Trump is unpredictable and he does everything to generate revenue. That’s why our gold is no longer safe in the Fed’s vaults. What happens if the Greenland provocation continues? … The risk is increasing that the German Bundesbank will no longer be able to access its gold. Therefore, it should repatriate its reserves.”
French officials probably don’t want to say it out loud, but they almost certainly have the same concerns as German leaders (and many others around the world). It’s easy to frame the sale as a technical move to improve reserve quality, but it undeniably solves a political problem.
Germany and France aren’t alone in thinking its gold might be safer at home.
According to a World Gold Council survey in 2023, a “substantial share” of central banks expressed concern about potential sanctions after the U.S. and other Western countries froze almost half of Russia’s $650 billion gold and forex reserves in the wake of its invasion of Ukraine. According to the WGC, 68 percent of the banks surveyed said they plan to keep their gold reserve within their country’s borders. This was up from 50 percent in 2020.
One anonymously quoted central bank official told Reuters, “We did have it [gold] held in London… but now we’ve transferred it back to our country to hold as a safe haven asset and to keep it safe.”
Several countries have repatriated gold in recent years, including India, the Netherlands, Australia, Poland, Hungary, and Romania.
This gold repatriation trend underscores the importance of holding physical gold free from counterparty risk.
If you store your gold and silver with a third party, you could lose your metal through theft, fraud, or an act of God. Of course, you could lose silver and gold stored in your home the same way (except for fraud), so you have to weigh the risk of using third-party storage and keeping large amounts of silver and gold at home.
Mike Maharrey is a journalist and market analyst for Money Metals with over a decade of experience in precious metals. He holds a BS in accounting from the University of Kentucky and a BA in journalism from the University of South Florida.
