The Bank of Portugal has significantly increased its gold reserves, marking a 34% rise in value amid continued global economic uncertainty and volatile financial markets. The surge is attributed primarily to the rising price of gold rather than additional purchases, reflecting a strategic move to bolster the country’s monetary buffer.
According to the central bank’s latest financial report, the value of its gold holdings rose to €26.9 billion by the end of 2024, compared to €20.1 billion the previous year. This is the highest valuation of Portugal’s gold reserves in its modern history and is seen as a strong indicator of conservative risk management in an increasingly unpredictable global economic environment.
“The increase is a direct result of higher international gold prices,” the bank explained. “The Bank of Portugal has maintained its physical gold reserves without any significant sales or purchases over the past year.”
Portugal holds one of the largest gold reserves in the eurozone, ranking among the top 15 gold-holding nations globally. The reserves, totaling approximately 382.6 tonnes, have remained largely unchanged for decades. The Bank of Portugal has long viewed gold as a safe haven asset and a hedge against market shocks, currency fluctuations, and inflation.
The sharp rise in value reflects a broader global trend: gold prices surged past $2,400 per ounce in early 2025, driven by a combination of factors including geopolitical tensions, inflationary fears, and central bank purchases worldwide. Many central banks, especially in emerging economies, have been diversifying away from US dollar holdings, increasing demand for physical gold.
Analysts say the appreciation of Portugal’s gold assets has important implications for the country’s financial stability and sovereign credibility. While the reserves do not directly fund the national budget, they provide a crucial cushion of security for the central bank, which can deploy them in the event of a crisis or currency turmoil.
“This is a form of insurance,” said Dr. Inês Faria, a Lisbon-based economist. “In an age where monetary policy is constantly being tested by external shocks—from wars to pandemics to inflation—gold remains an anchor.”
The increase in gold value has also bolstered the Bank of Portugal’s balance sheet, helping it absorb pressures from higher interest rates and a slowing economy. Like many eurozone nations, Portugal has faced challenges related to the European Central Bank’s (ECB) recent policy shifts, including tighter monetary policy aimed at curbing inflation.
Despite the positive news, central bank officials stressed that the gold appreciation should not be seen as a panacea for broader fiscal challenges. Portugal continues to navigate a complex landscape of public debt management, economic reforms, and efforts to sustain growth amid uncertain external conditions.
Still, the robust state of the gold reserves adds a layer of resilience to the nation’s macroeconomic fundamentals. It also enhances the central bank’s credibility as a guardian of financial stability, especially as Portugal seeks to attract long-term investment and retain investor confidence.
In recent years, some critics have called for Portugal to monetize part of its gold stockpile to support social spending or economic stimulus. However, the central bank has consistently rejected such proposals, arguing that the gold should be preserved as a strategic long-term asset, only to be used under exceptional circumstances.
The latest figures affirm that approach. As the global economy continues to face disruptions—from geopolitical shocks to climate-related risks—the value of having a strong, untouched reserve of physical gold has become increasingly apparent.
With other central banks in Europe and beyond also reporting increased valuations of their gold holdings, Portugal’s experience is part of a wider trend of defensive economic policy, reinforcing the enduring role of gold as a key pillar in central banking strategy.
Source: The Portugal News
