France’s Central Bank “Gold Pullback” Masterstroke: Doesn’t Ship Gold, Doesn’t Upset the U.S., and Still Nets €11 Billion

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Source: Jin10 Data

The French Central Bank has found a clever way to transfer gold out of U.S. custody while avoiding diplomatic disputes: selling it at high prices in New York and then repurchasing it on the European continent.

As part of the 2025 fiscal year announcement, this central bank disclosed a “special project” that turned a loss of 2.9 billion euros into an annual profit of 8.1 billion euros.

In a press release on March 25, the central bank stated: “In 2025 and early 2026, with the total gold reserves remaining unchanged, the French Central Bank had to adjust the remaining portion (5%) according to technical guidelines, thereby achieving significant realized foreign exchange gains. In 2025, this special foreign exchange income totaled 11 billion euros.”

This operation is both clever and profitable. Unlike Germany’s ongoing dilemma of storing large amounts of gold reserves in the U.S., the French Central Bank did not attempt to withdraw or transfer gold. Instead, they took advantage of gold prices reaching historic highs by selling older, lower-purity gold bars in New York for USD, then buying back gold bars that meet their latest weight and purity standards when prices just fell back. Germany’s gold remains stored in the Federal Reserve Bank of New York, much to the discontent of many German politicians.

This is a “win-win-win” deal for the French Central Bank: amid tense U.S.-Europe relations over tariffs, Greenland, Ukraine, and Iran, it avoided any diplomatic backlash from the U.S. government; it saved on cross-Atlantic transportation and security costs; and the transaction itself generated huge profits, boosting the bank’s overall financial health.

“France’s central bank’s net assets—comprising own funds plus unrealized capital gains on assets—have now reached 283.4 billion euros, extremely solid, higher than the 2024 figure of 202.7 billion euros,” they noted. “France’s central bank’s net assets include 11.4 billion euros of revalued national gold and foreign exchange reserves, used to cover future monetary expenditures.”

François Villeroy de Galhau, Governor of the French Central Bank, told reporters that the decision to store new gold bars in Paris rather than New York “was not motivated by political reasons.”

After these transactions, France’s total gold holdings remain unchanged at approximately 2,437 tons, with all of the country’s gold reserves now stored in the underground vault of the French Central Bank in La Souterraine.