Brazil's Central Bank Significantly Increases Gold Reserves by 33%

Brazil Bolsters Gold Reserves Amid Global Risks

The Banco Central do Brasil, Brazil's central bank, substantially increased its gold reserves by 33% between September and November 2025. This surge brought the nation's total gold holdings to 172.4 tons, marking a significant shift in its reserve management strategy. The move comes after a four-year hiatus in net gold purchases, with the last significant acquisitions occurring in 2021.

Strategic Diversification and De-dollarization Efforts

The central bank's decision to acquire an additional 42.8 tons of gold during this period is primarily driven by a strategy to diversify its assets and reduce dependence on the U.S. dollar. This aligns with a global trend among central banks, particularly in emerging markets, to seek alternative safe-haven assets amidst rising global economic and geopolitical uncertainties. Gold is increasingly viewed as a politically neutral and sanction-resistant asset, offering protection against currency depreciation and inflation.

While gold still constitutes a minority holding, representing approximately 6.5% of Brazil's total international reserves of about US$360.6 billion in November 2025, the dollar's share in these reserves has seen a decline from 86.77% in 2019 to 78.45% in 2024. This indicates a deliberate effort to rebalance the reserve portfolio.

Impact of Market Dynamics and Regulatory Changes

The timing of Brazil's gold purchases coincided with a robust performance in the gold market. The market value of Brazil's gold nearly doubled in 2025, escalating from approximately US$11.7 billion in January to about US$23.3 billion by November, partly due to a 65.2% gain in gold prices during the year. The newly acquired gold alone was valued at around US$6 billion at late-2025 prices of approximately US$4,300 per ounce.

Furthermore, regulatory changes have bolstered the appeal of gold for central banks. In July 2025, the Basel III framework reclassified physical gold as a Tier 1 liquidity asset, placing it on par with cash and government bonds for liquidity reserves. This reclassification has incentivized physical gold holdings and contributed to increased institutional demand globally.

Broader Global Context

Brazil's actions reflect a wider movement among BRICS nations (Brazil, Russia, India, China, and South Africa) to systematically reduce their reliance on dollar-denominated reserve assets. This collective strategy underscores a growing desire for financial stability and autonomy in an increasingly unpredictable global economic landscape. Central banks worldwide added a net 39 tonnes of gold to their holdings in September 2025, with Brazil being a significant contributor to this global trend.