Survey | Nearly 70% of central banks cite geopolitical risks as the primary concern

A survey conducted by Central Banking Publications of central banks around the world shows that this year central banks’ concerns about geopolitical tensions have risen sharply, and they are increasingly seen as the top global risk.

The survey of nearly 100 institutions was carried out from January to March. The results reflect that nearly 70% of central banks list geopolitics as their top risk, replacing last year’s top concern—U.S. trade protectionism. Moreover, compared with 2024, when 35% of central banks listed geopolitics as their top worry, that share has increased markedly. In 2024, the war in Gaza had threatened stability in the Middle East region.

The survey shows that over the next five years, inflation and interest rates will remain the most important factors expected to affect reserve management, with slightly more than half of central banks listing them as their top concern. But this figure is clearly lower than last year’s 76%. In addition, about 80% of reserve managers say they agree or strongly agree that the U.S. dollar is still the world’s top safe-haven currency, but many managers add that its dominance is increasingly being questioned. These central banks manage more than $9.5 trillion in reserves.

The survey also shows that 16% of central banks believe that the dollar’s position over the next five years will affect their reserve management decisions, while last year that figure was only slightly above 3%.

Respondents’ confidence in U.S. bonds has also declined noticeably. Only one-third of respondents expect U.S. bond performance to be better than that of other G7 countries and China, a figure that is clearly lower than last year’s more than half and more than 70% in 2024.

At the same time, gold remains a beneficiary during periods of geopolitical uncertainty. Nearly three-quarters of central banks say they hold gold in their reserves, a proportion that is slightly higher than last year. Meanwhile, nearly 40% of central banks say they are considering increasing their gold allocation.