Why Does Germany Keep So Much of Its Gold in New York and London?
Germany owns about 3,350 tonnes of gold, the second-largest national reserve in the world after the United States. Yet if Berlin suddenly wanted to see all of it, almost half would require a trip abroad.
At the end of 2025, 1,236 tonnes were sitting at the Federal Reserve Bank of New York and another 404 tonnes at the Bank of England in London. Only 1,710 tonnes, just over half the total, were stored at the Bundesbank in Frankfurt.
That arrangement has periodically triggered calls to "bring the gold home". The debate returned in early 2026, when several German economists and politicians questioned whether keeping such a valuable reserve in the United States still made sense.
The obvious question is why Germany put it there in the first place.
Germany did not simply ship its gold to America
Most of Germany's gold was accumulated during the economic boom that followed the Second World War.
West Germany ran large trade surpluses and accumulated US dollars through the Bretton Woods monetary system. Those dollars could be converted into gold, and much of the gold was already sitting in financial centres such as New York, London and Paris.
Moving thousands of heavy gold bars back to Germany would have added cost without providing much practical benefit. Keeping the metal near the major markets where it could be exchanged for foreign currency was useful.
That logic has survived long after the Bretton Woods system disappeared.
Where the gold actually sits today
Bundesbank figures for 31 December 2025 show how the reserve is divided. Frankfurt held 1,710 tonnes. New York held 1,236 tonnes, while the Bank of England held 404 tonnes.
At year-end market prices, the Bundesbank valued the entire reserve at about €395 billion. The New York portion alone was worth €145.8 billion and the gold in London another €47.7 billion.
The value will move with the gold price, but the physical allocation changes very little from year to year. Germany is not actively trading large chunks of its reserve.
It has already brought a substantial amount home. Between 2013 and 2017, the Bundesbank transferred 300 tonnes from New York and 374 tonnes from Paris to Frankfurt. The operation was completed ahead of schedule.
London is more useful than it first appears
Keeping German gold underneath the Bank of England may sound odd when Frankfurt is only a short flight away. There is a practical reason. London remains the world's main wholesale gold trading centre.
The Bank of England holds around 400,000 gold bars for the UK government, foreign central banks and other approved institutions. When one customer sells gold to another customer at the Bank, the bars often do not move at all. Ownership is simply changed in the Bank's records.
For a central bank, that is useful. Gold sitting in Frankfurt is secure, but gold already inside a major trading centre can be turned into sterling, dollars or another reserve asset without first transporting tonnes of metal across borders.
The Bundesbank itself has said that one reason for keeping reserves abroad is the ability to exchange gold for foreign currency quickly.
Why some Germans want the New York gold back
The argument for repatriation changed during 2026.
Earlier campaigns often focused on transparency and whether Germany should physically control an asset it owns. More recent calls have focused on geopolitical risk and the possibility that relations between Europe and the United States could deteriorate.
Former Bundesbank research chief Emanuel Mönch argued in January that keeping such a large amount of gold in the US had become riskier and that repatriation could give Germany greater strategic independence.
Others went further, questioning whether Germany could always assume unrestricted access to the gold if a serious political dispute developed.
The German government and Bundesbank have not accepted that argument. Bundesbank president Joachim Nagel has previously said there was no reason for concern, while German officials have pointed out that the reserves are deliberately spread across several locations.
The strange thing about gold: location still matters
One reason the argument attracts so much attention is that gold is different from most reserve assets. A government bond is essentially a financial claim. Gold is a physical asset with no issuer and no counterparty promising to repay it.
That is part of its attraction to central banks. But the benefit comes with an unusual problem: somebody has to keep the bars somewhere. The country storing them therefore matters.
Keeping every bar domestically maximises physical control. Keeping some in New York and London gives Germany immediate access to two of the world's biggest financial markets. Those objectives pull in opposite directions.
My view: bringing every bar home would solve the wrong problem
My view is that Germany has a reasonable case for reviewing how much gold it keeps in New York, particularly when 1,236 tonnes represents such a large strategic asset. But bringing all of it back to Frankfurt would make little economic sense.
Germany already controls more than half of its reserve domestically. Keeping part of the remainder in New York and London gives the Bundesbank something that a vault in Frankfurt cannot provide as easily: immediate access to deep international markets.
The strongest argument against this position is that market access is worth little during the kind of severe geopolitical crisis in which access to foreign-held reserves becomes uncertain.
That risk exists. The question is whether it is large enough to justify giving up the practical advantages of geographic diversification.
Watch what Germany does, not what politicians say
The more revealing signal will not be another speech calling for Germany's gold to come home. Watch the Bundesbank's storage figures.
Germany has already demonstrated that it can move hundreds of tonnes of gold when it wants to. If the 1,236 tonnes held in New York begins to fall materially over several years, that would show that concerns about strategic dependence are changing actual reserve policy.
For now, the arrangement remains remarkably stable: roughly half at home, a little over a third in New York and most of the remainder beneath London.
That balance tells us something important. Central banks may buy gold because it is independent of any currency, but even gold becomes more useful when it is stored close to the currencies you may eventually want to exchange it for.