Central Banks Selling Gold: Why Russia and Turkey Are Still Not Signaling an Exit

4,082.16 US dollars per troy ounce: This was the level at which gold was quoted in international trading on July 27, 2026. The euro price reported by GOLD.DE on the same day peaked at 3,587.85 euros. Despite the significant correction from the record high, gold remains a central factor in international financial markets.

At the same time, reports of extensive gold sales by individual central banks are attracting attention. Russia and Turkey in particular reduced their reported holdings in 2026. This quickly creates the impression that state institutions could be fundamentally turning away from the precious metal.

However, the data shows a different picture. While some countries are mobilizing gold to obtain liquidity, other central banks continue to expand their reserves. Therefore, it is not only crucial who is selling, but for what reason the transaction is taking place and how global net purchases are developing.

Gold Price Reacts to Interest Rates, Geopolitics, and Liquidity

On July 27, the gold price rose by 0.73 percent to 4,082.16 US dollars per troy ounce, according to Reuters. July gold futures on the Comex ended trading at 4,074.50 US dollars, marking the second consecutive day of gains.

The market environment was noteworthy: at the same time, the price of Brent crude oil fell by more than nine percent, while the yield on ten-year US Treasuries dropped to 4.649 percent. The movements followed a temporary pause in military conflicts between the USA and Iran.

This combination illustrates that the gold price is not determined by a single factor. Expectations regarding monetary policy, real and nominal bond yields, the US dollar, geopolitical risks, futures market positions, and physical demand all act on the market simultaneously.

For the upcoming meeting of the US Federal Reserve, a 38 percent probability of an immediate interest rate hike was priced in on July 27. For a rate step by September, market expectations stood at 83 percent. Higher interest rates can weigh on gold in the short term because the precious metal itself does not distribute ongoing yields. Falling yields or growing doubts about the stability of other assets can support demand instead.

Which Central Banks Sold and Bought Gold in 2026

According to the World Gold Council, central banks worldwide bought a net total of around 41 tons of gold in May 2026. The extensive sales by Russia and Turkey were thus more than offset by purchases from other central banks.

Source: World Gold Council, IMF, and respective central banks; data as of publication on July 2, 2026.

Russia and Turkey together accounted for reported sales of around 115 tons. This figure alone seems substantial at first. However, it must not be viewed in isolation. Poland, Uzbekistan, China, and Kazakhstan together acquired around 142 tons during the same period.

The international central bank market in 2026 did not consist of a uniform selling movement. Rather, different economic interests collided: some states obtained liquidity, while others continued to diversify their reserves.

The Common Misconception: Every Sale is a Vote of No Confidence Against Gold

The obvious expectation is: if a central bank sells gold, it must consider the precious metal less attractive.

The reality is more nuanced. Gold reserves are held precisely because they can be mobilized in stressful situations. A sale can therefore be an expression of financial pressure or short-term liquidity needs without changing the long-term assessment of the precious metal.

In the first quarter of 2026, central banks and other state institutions bought a net total of around 244 tons of gold, according to estimates by the World Gold Council. This was 17 percent more than in the previous quarter and around three percent more than in the first quarter of 2025. Despite visible sales, the official sector thus remained a significant net buyer overall.

Gold fulfilled its function on both sides of the market. Buyers used it to diversify their reserves. Sellers relied on a liquid, globally tradable asset that is not dependent on the solvency of a single issuer.

Why Turkey Mobilized Gold

Turkey was the largest reported seller in the first quarter of 2026. Its official gold holdings fell by around 70 tons, according to calculations by the World Gold Council. Additionally, in March, about 80 tons were used via gold-currency swaps for foreign exchange and liquidity purposes.

This distinction is important. In a swap, gold is not necessarily given away permanently. The Turkish central bank explained that a significant portion of the transactions had the character of temporary gold-currency deals. Upon maturity, the gold in question could return to the reserves.

The sales and swap transactions therefore suggest a tactical use of reserves rather than a complete change in strategy. Turkey used an existing asset to provide foreign exchange and liquidity in the short term.

By May, reported Turkish net sales totaled 81 tons. Nevertheless, a distinction should be made between a permanent reduction of the strategic reserve and a temporary mobilization.

What the Russian Gold Sales Indicate

Russia sold a net total of around 34 tons of gold by May 2026, according to the World Gold Council. Reported holdings thus fell to approximately 2,292 tons. Despite the sales, Russia continued to possess one of the largest state gold reserves in the world.

The transactions take place in an environment of high fiscal burdens, restricted access to Western financial markets, and ongoing geopolitical tensions. Gold is particularly relevant in such a situation because it can be traded within one's own financial system or used as collateral.

However, the exact purpose of every ton sold cannot be derived from reserve statistics alone. The statement that all sales served directly to finance the war would therefore be too definitive. What is verifiable is that Russia mobilized part of its reserves while simultaneously continuing to hold a stock of more than 2,290 tons.

Here, too, the central difference is evident: a country can sell gold precisely because it previously assigned the precious metal a strategic and liquid reserve function.

Can the Sales Weigh on the Gold Price Permanently?

Additional supply can dampen the gold price in the short term. This is especially true when large quantities are reported in an already nervous market. The sales by Russia and Turkey are therefore likely to have been among the factors that weighed on sentiment in the first half of 2026.

However, a sustainable downward trend cannot be automatically derived from this. The global gold market is determined by an interplay of mine production, recycling, jewelry demand, investment products, futures markets, private purchases, and state demand.

Furthermore, other central banks continue to increase their holdings. Poland held around 614 tons of gold at the end of May, approaching its goal of 700 tons. China bought ten tons in May, increasing its official holdings to around 2,331 tons.

The sales of individual countries are therefore offset by broad structural buying interest.

Central Banks Still Expect Rising Gold Reserves

The long-term assessment of reserve managers remains clearly in favor of gold. In the World Gold Council's 2026 Central Bank Survey, 89 percent of respondents expected global state gold reserves to increase within the next twelve months.

A record 45 percent also expected an increase in their own institution's gold holdings. Only one percent expected a decrease. Furthermore, 74 percent of respondents assumed that the US dollar's share of global reserves would fall moderately or significantly over the next five years.

Over the past four years, central banks acquired an average of about 1,000 tons of gold per year. In the preceding decade, the average had been approximately 500 tons. The structural accumulation of state gold reserves has thus roughly doubled compared to the previous comparison period.

What Private Investors Can Derive from the Data

The sales by Russia and Turkey show neither that gold has become meaningless, nor do the purchases by other central banks guarantee rising prices. Rather, they illustrate how differently gold can be utilized.

For central banks, it is a strategic reserve, a source of liquidity, a diversification instrument, and a hedge against certain geopolitical and monetary risks. Different conditions apply to private investors. Here, factors such as investment horizon, personal risk tolerance, premium, storage, and the actual availability of the physical metal must be considered.

At spar.gold, a clear principle therefore applies: only physical precious metal that is actually available is offered. Because a displayed market price and a product that can actually be delivered are not the same thing.

The crucial insight is: A sale is a transaction – only the reserve context reveals its true meaning.

Stay farsighted, yours Helge Peter Ippensen

Note: This post is for general information purposes only and does not constitute investment advice or a recommendation to buy or sell precious metals.