Why France Sold 129 Tonnes of Gold in New York, to Buy It Back in Europe? Inside BdF's Profitable Repatriation

France's gold repatriation from New York has been completed in a transaction that has highlighted innovative approaches to central bank reserve management. In a series of transactions between July 2025 and January 2026, the institution sold 129 tonnes of older bullion stored at the Federal Reserve Bank of New York.

It then bought back an identical volume of higher-standard bars in Europe, ensuring all 2,437 tonnes of France's gold reserves are now held in Paris. The move upgraded the holdings to meet current international specifications while delivering a capital gain of £11.2 billion ($15 billion).

Why the Banque de France Chose to Sell in New York and Buy in Europe

The decision was driven by practical considerations rather than geopolitics. The bars in New York, some dating to the late 1920s, no longer conformed to modern purity and weight standards used in international gold trading. Physically shipping them back would have incurred significant security and insurance costs, not to mention the complexities of refining older stock to LBMA-compliant levels.

By selling at peak prices in the US market and purchasing equivalent tonnage in Europe as prices eased, the central bank achieved repatriation without moving a single bar across the Atlantic. This approach also avoided raising the sensitive issue of withdrawing custody from the New York Fed, a topic that has caused diplomatic tension elsewhere, as seen in Germany's case.

The Banque de France described the operation in understated terms. It formed part of a long-term programme to standardise reserves, with the 129 tonnes representing about 5 per cent of total holdings.

Inside the Profitable Mechanics of the Gold Swap

The deal was executed through 26 separate transactions, capitalising on gold price fluctuations. Sales in New York locked in high values for the non-standard bars, while European purchases were made at more favourable rates. The result was a realised gain that some market observers valued at around £11.2 billion ($15 billion).

This windfall transformed the bank's accounts. It contributed to a net profit of €8.1 billion (£7.05 billion or $9.47 billion) for 2025, reversing a €7.7 billion (£6.70 billion or $9 billion) loss from 2024. As the Banque de France stated in its March financial update, 'Income from assets held for own account rose by EUR 12.2 billion as a result of an exceptional item.'

Governor François Villeroy de Galhau reinforced the technical nature of the exercise, calling it 'not politically motivated'. The profit has strengthened the bank's net equity to €283.4 billion (£246.57 billion or $331 billion), providing a solid buffer.

The Completion of Domestic Gold Storage

France's full repatriation means every ounce of its gold is now stored in the secure underground facility known as La Souterraine, south of Paris. This ends decades of partial overseas custody and aligns with a global trend among central banks to keep reserves closer to home for greater sovereignty and liquidity.

A small amount of additional older bars and coins remains to be upgraded by 2028, but the New York operation represents the final overseas component of the consolidation effort.

As one Instagram account observed recently, France's central bank sold 129 tonnes of gold previously held at the Federal Reserve Bank of New York and replaced it with newly purchased, higher quality bars in Europe. The strategy has positioned the reserves for future stability amid economic uncertainties.