Kazakhstan Plans to Cut Gold Reserve Share to 75% by Year-End

Kazakhstan’s central bank plans to reduce gold’s share of its foreign-exchange reserves to 75% by year-end, as higher U.S. Treasury yields prompt a reassessment of dollar assets.

Gold currently represents about 78% of Kazakhstan’s reserves. The planned reduction would shift the central bank toward selling part of its gold holdings as it adjusts the mix of reserve assets.

Higher Treasury yields have made dollar assets more appealing and are prompting Kazakhstan to reassess its allocation between gold and dollar assets. Energy disruptions and higher import costs after the U.S.-Iran war began in late February also increased market demand for the dollar.

The move comes as global central banks continue increasing their gold holdings, following years of efforts to diversify reserves after the 2008 global financial crisis. The freezing of large Russian foreign-exchange reserves by Western countries in 2022 further prompted some monetary authorities to reassess their reliance on traditional foreign assets.

Turkey and Russia sold portions of their gold holdings earlier this year, showing that central-bank gold reserves can change in response to liquidity needs and asset-allocation goals.

Kazakhstan’s central bank plans to complete the reduction by the end of the year.