France’s central bank shifts strategy: less U.S., more control

France has carried out a quiet but strategically significant operation with its gold reserves, which simultaneously generated nearly €13 billion in profit and changed the geography of where part of the national gold is stored, Reuters reports, citing the regulator’s report. The operation involved 129 tonnes — about 5% of the country’s total reserves — which had been stored in New York for many years. Formally, this looks like a technical upgrade of assets, but in reality it is a combination of financial calculation and geopolitical caution.

From July 2025 to January 2026, the Banque de France gradually sold old gold bars and replaced them with new ones that meet modern international standards. These standards concern not only the purity of the metal, but also shape, weight, certification, and liquidity on the global market. Older bars, especially those stored for decades, can differ in parameters and be less convenient for fast transactions. New bars comply with the requirements of major trading platforms and central banks, making them a more universal instrument.

The key point is that the operation was carried out against the backdrop of high gold prices. This made it possible to lock in a significant one-off profit. In essence, the Bank of France took advantage of market conditions: it sold assets at high prices while simultaneously upgrading them without losing value — and in fact with a substantial financial gain. In reporting, this was reflected as a one-time income of nearly €13 billion.

Equally important is where this gold is now located. After the upgrade, the bars were placed in Paris. This completes a long-running process of repatriating part of the reserves, which has been actively discussed in Europe since the early 2010s. At that time, amid financial crises and growing distrust in the global asset storage system, many countries began reconsidering where exactly to keep their gold.

Formally, storing reserves in the United States has always been considered safe and convenient — New York remains one of the world’s key gold storage centers. However, recent years have introduced a new factor: geopolitical risk. Even if it does not materialize directly, its very existence pushes central banks to diversify not only assets but also their physical location.

Notably, the gold upgrade process in France was not a spontaneous decision. It lasted more than two decades. During this time, the Bank of France gradually replaced outdated or non-standard bars with more liquid ones. An internal audit in 2024 only accelerated the completion of this program, pointing to the need to finalize the modernization of the portion of reserves that remained outside the country.

As a result, France solved several задач at once. First, it improved the quality and liquidity of its gold reserves. Second, it locked in profits from rising prices. Third, it reduced dependence on external storage, strengthening control over its own assets.

For the market, this is a broader signal than it may seem. Gold is once again seen not just as a passive reserve, but as an actively managed asset. Central banks are beginning to act not only as custodians but also as strategic players who take into account prices, liquidity, and the geography of risks.

In a broader context, this fits into a global trend of recent years: growing interest in gold amid inflation, geopolitical tensions, and a reassessment of the role of the dollar in the global financial system. And while such operations used to go almost unnoticed, today they are becoming part of a bigger picture — where each country seeks to keep not only its money, but also control over it closer to home.

In this sense, France is acting quite pragmatically: while the market offers an opportunity to profit and risks provide a reason to hedge, it is better to do both at the same time.