Why are European countries moving their gold out of North America?

The Netherlands has moved 86 tons of gold from North America to London, saying the relocation would better prepare its reserves for a severe crisis. The transfer involved 86 of the 313 tons that were or are stored in the United States and Canada.

The decision reflects growing caution amid geopolitical unrest, trade wars and military conflicts. France announced earlier this year that it would move gold reserves from the United States, while Germany’s Bundesbank had transferred more than 216 tons from foreign storage facilities by 2016, including 111 tons from New York and 105 tons from Paris.

Experts described the strategy as a precaution used by many countries during periods of global instability. Goldman Sachs research analysts Lina Thomas and Daan Struyven said some European central banks moved part of their reserves to New York during the Cold War. A market strategist said wars and trade tensions had influenced recent decisions, but inflation, interest rates and the advantage of keeping gold close also mattered.

London was not chosen at random. It is a major trading center where gold can be bought or sold quickly, and the Bank of England is one of the world’s largest gold custodians. The 300-year-old institution stores about 400,000 gold bars valued at more than 200 billion pounds.

Not all the Dutch gold crossed the Atlantic physically. According to the BBC report, the Netherlands sold about 59 tons in New York and bought shares in London, meaning that some of the reserve was transferred through financial transactions. The Dutch central bank said the relocated gold is stored in vaults at a British bank. Governor Olaf Sleijpen said he did not expect the reserves to be needed, but wanted to strengthen resilience and prepare for surprises.

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We do not expect to need the reserves, but we must strengthen our resilience and be prepared for surprises.