Gold now outweighs bonds in global reserves

Gold now outweighs bonds in global reserves

According to a calculation making the rounds among precious metals market watchers, gold has overtaken US Treasuries as a reserve asset: it would account for 27% of global reserves, versus 22% for US debt and 15% for the euro. The figure captures a shift that has been simmering for months and accelerated in the final stretch of 2026 with the repatriation of reserves from London to Hong Kong and with central banks buying without paying much attention to price.

Meanwhile, the US ten-year bond has hovered around 5%, with the thirty-year trading above 5.3%. In Europe, the picture is worse. The combination of inflation that refuses to ease, Brent crude approaching $120 and the US Treasury buying back debt to contain yields paints a scenario many already describe as a slow-motion sovereign debt crisis.

The 5% bond and the trap of Bessent's buybacks

Treasury Secretary Scott Bessent has expanded the bond buyback program to limit the rise in yields. The move is nothing new —it was implemented in the early 2000s and restarted in 2024—, but since August it has been sold as a rate-control tool rather than a liquidity one. The result is a market that reads every intervention as a sign that Washington has a tolerance threshold and is brushing right up against it.

The two-year yields 4.5%, the ten-year 4.93% and the thirty-year 5.34%. At those levels, financing costs for companies and households skyrocket. Some argue the country is broke and the only way out is to inflate the debt away; others suggest that seizing from debtors and letting companies fail before the state is the path that will be chosen. Neither is pleasant.

China moves its gold from London to Hong Kong

The People's Bank of China has been accumulating gold inventories in Hong Kong in recent months, accelerating a long-term trend: repatriating part of its reserves from London. Bloomberg reported it, citing sources who asked to remain anonymous. The maneuver fits into a broader Asian strategy of positioning for a possible shift in the monetary order.

On top of that, several major Chinese banks, led by ICBC, have restricted retail precious metals operations amid high volatility. Gold, meanwhile, has been elevated to Tier 1 under Basel III, placing it on par with sovereign debt and cash in risk terms. US reserves are still valued at $42.22 per ounce as they have been since 1973, without revaluation: at market prices, revaluing them would add $1.13 trillion to the balance sheet.

Silver and the $75 target

Silver has broken the weekly high at $69.03 and is pointing toward support zones at $71.05 and $72.10. The likely target of the head-and-shoulders pattern sits around $75. The most widespread technical analysis expects sideways consolidation before the price trickles down to the retail market, with central banks buying aggressively behind the scenes.

Bank of America has issued a bullish report on gold with a price target of $4,813 per ounce for 2027. In certain circles, the figure is considered conservative given the context. Tether, for its part, keeps accumulating gold purchases that some observers view with suspicion.

Oil, diesel and the refinery that never rests

Brent has rocketed up to flirt with $120. Behind it lies the destruction of refineries in Russia and the Middle East from the wars in Ukraine and Iran, which overloads the rest of the world's refineries and forces maintenance shutdowns to be postponed. In the United States, there is debate over banning diesel exports, a measure the industry itself warns could raise domestic gasoline and jet fuel prices.

The US exported 1.26 million barrels per day of diesel in 2025, 15.4% of the global total. The five largest exporters supplied 46.9%, led by the US, Russia and Saudi Arabia. Any restriction on that flow has global consequences.

Stock buybacks and the S&P 500 mirage

S&P 500 companies have been the marginal buyers of US stocks for a decade. Buybacks hit a record $1.02 trillion in the twelve months through September 2025, nearly 60% of all cash returned to shareholders. Between June 2021 and June 2026, earnings per share grew 13.2% annually, but the price-to-earnings multiple also expanded. Without the buybacks, returns would have been a different story.

Private consumption accounts for 70% of US GDP, but the personal savings rate stands at 4%, versus 10-20% in the seventies. With that cushion, any supply shock transmits to spending quickly. 35% of the population cannot cover an unexpected $400 payment.

Market manipulation as economic policy

Trump's ability to move markets with statements has become just another valuation factor. Announcements about Iran, tariffs or inflation have produced intraday swings that benefit whoever gets the information first. The press conference in which the president repeatedly referred to the stock market left little room for interpretation.

The episode of the Apache helicopter —downed, according to the official version, by an Iranian drone, with the pilots rescued within ten minutes by an uncrewed vessel— illustrates just how intertwined the narrative and the market are. The bomb lodged without detonating, according to the explanation given. No further details were provided.

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The analysis keeps getting stuck on the same point: if gold is worth more than bonds in global reserves, someone will have to explain what happens when yields keep rising and buybacks stop being enough.