Berlin Debates Bringing Gold Home Amid Fears Over US Policy Shifts

The chair of the European Parliament's Committee on Security and Defense, Marie-Agnes Strack-Zimmermann, has demanded that Germany return its gold reserves currently stored in the United States.

Photo: pixabay by Стивбидмид, https://creativecommons.org/public-domain/pdm/

Gold Bullions

According to the European lawmaker, who is also known for her strongly anti-Russian statements, such a move has become necessary due to the unpredictability of the policies pursued by the administration of Donald Trump.

At present, around 37 percent of Germany's gold reserves are held in the vaults of the US Federal Reserve in New York.

Germany possesses one of the largest gold reserves in the world, ranking second only to the United States by volume.

Why German Gold Ended Up Abroad

Historically, a significant share of Germany's gold was placed outside the country after World War II. This decision was shaped by the Cold War, the division of Europe, and the desire to store assets in the financial centers of allied states.

The primary storage locations became the United States, the United Kingdom, and France.

For decades, keeping gold abroad was viewed as a guarantee of security. New York and London were seen as key global financial hubs, where gold could be quickly used for international settlements or currency stabilization.

Shifting Attitudes Toward Foreign Storage

In recent years, attitudes toward this practice have begun to change. Geopolitical tensions are rising, while sanctions and financial restrictions are playing an increasingly prominent role. As a result, governments are reassessing how they manage strategic reserves.

Across Europe, discussions about financial sovereignty are becoming more frequent. Gold is now regarded not only as an economic asset but also as an element of national security. Storing a substantial portion of reserves overseas is raising concerns amid potential political conflicts and trade disputes.

Germany's Previous Repatriation Efforts

Germany already has experience in bringing gold back home. Between 2013 and 2017, the Bundesbank carried out a repatriation program under which more than 600 tons of gold were transported from the United States and France.

After the program was completed, roughly half of Germany's gold reserves were stored in Frankfurt am Main.

Nevertheless, a considerable share of the country's gold remains abroad, primarily in the United States.

Germany is not alone in storing gold in New York. The US Federal Reserve is the world's largest depository of foreign gold, holding reserves for dozens of countries, including Italy, the Netherlands, Belgium, Switzerland, as well as several nations in Asia and Latin America. Traditionally, these vaults were considered neutral and highly reliable.

Yet in recent years, some countries have begun to rethink this model. The Netherlands returned about 120 tons of gold from the United States in 2014, explaining the move as a way to achieve a more balanced distribution of reserves.

Austria also decided to reduce the amount of gold held abroad and increase the share stored domestically.

Hungary significantly expanded its gold reserves in 2018 and 2021 and transferred almost all of them to Budapest.

Poland repatriated more than 100 tons of gold from the United Kingdom in 2019. The National Bank of Poland emphasized that the physical presence of gold within the country strengthens confidence in the financial system and reinforces economic independence.

Italy and France continue to keep substantial amounts of gold outside their borders, including in the United States. However, debates over the wisdom of this approach periodically surface in both countries.

Formally, ownership rights to gold do not depend on where it is stored. But in times of crisis or political disagreement, access to such assets can become a sensitive issue.

The question of bringing gold back to Germany goes beyond symbolism. It touches on trust between allies, the resilience of the financial system, and the role of gold in the modern economy.

The final decision rests with German authorities and the Bundesbank. Still, the very fact that the issue is being raised suggests that the era of unquestioned trust in the foreign storage of strategic reserves is gradually coming to an end.