As geopolitical and macroeconomic tensions escalate, India and China are reducing their US Treasury holdings and increasing gold reserves, signalling a strategic move towards diversification amidst global uncertainties.
The strategic composition of international reserves is shifting as India and China pare back holdings of US Treasuries and accelerate purchases of gold, a move that market participants and central bankers say reflects a desire for greater diversification amid geopolitical and macroeconomic uncertainty.
According to the report by Czech Journal, both countries have been reducing exposure to US government debt while embracing gold as a safer, culturally and politically acceptable store of value. That broad picture is supported by more detailed national data and reporting across markets.
India’s central bank has been steadily increasing its gold stock. According to Business Standard, the Reserve Bank of India raised its gold reserves by 39.22 metric tonnes to 879.98 tonnes, while its reported US Treasury holdings fell to $227 billion in June 2025 from $242 billion a year earlier. Business Standard also noted that India’s overall foreign exchange reserves remained robust at $690 billion as of August 22, 2025, underscoring that the shift reflects reallocation rather than a loss of external buffers.
Other Indian reporting shows the same direction although with differing snapshots: Moneycontrol recorded India’s US Treasury holdings at $232.5 billion in April 2025, down from $233.5 billion a year earlier, while The Economic Times reported holdings slipping below $200 billion by October 2025, with RBI gold at about 880.18 tonnes. Those differences in levels reflect timing and disclosure lags but collectively point to a pronounced reduction over 2024–25 and continued accumulation of bullion.
China’s adjustments are similarly prominent. According to reporting in The Times of India and Business Standard, China reduced its US Treasury holdings to levels not seen in many years , Business Standard and other outlets put the figure at roughly $682.6 billion in November 2025, a 17‑year low , and concurrently boosted gold holdings, with The Times of India citing a rise to about 74.15 million ounces by the end of December 2025. Business Standard also noted China’s very large overall reserves, around $3.36 trillion as of December 2025, framing the move as portfolio diversification rather than a liquidity squeeze.
Economists cited by Moneycontrol attribute the sell‑down to several interlocking concerns: the prospect of sustained high US inflation and elevated Federal Reserve policy rates, fears about the United States’ fiscal trajectory and creditworthiness, and the desire to reduce reliance on dollar‑denominated assets. According to Moneycontrol, China’s holdings fell to $757.2 billion in April 2025 from $770.7 billion in April 2024, while India’s were already trimming in that period.
Gold’s appeal is multifaceted. Beyond its role as a traditional safe haven, central banks see it as a hedge against both inflation and geopolitical risk. India and China also carry strong cultural preferences for gold, which supports its political acceptability as a reserve asset. Industry commentary compiled by India Today projected central banks would buy roughly 900 tonnes of gold in 2025, marking a fourth consecutive year of above‑average purchases and signalling a structural shift: the outlet reported that 76% of central banks expect to raise the share of gold in their reserves.
The reallocation has market consequences. Reduced demand for Treasuries can exert upward pressure on yields and complicate US funding dynamics if sustained across many holders, while heavier central‑bank buying of gold tends to lift bullion prices and influence commodity markets more broadly. Czech Journal and the other outlets emphasise that the moves by India and China are likely to encourage other countries to reassess reserve composition, accelerating a longer‑term rebalancing of global financial architecture away from singular dependence on US‑dollar instruments.
Taken together, the reporting depicts a deliberate, measured pivot rather than a sudden repudiation of dollar assets. Government figures and market watchers quoted across Business Standard, The Economic Times, Moneycontrol, The Times of India and India Today show both nations retaining substantial foreign‑exchange buffers while reallocating portions into gold and other assets deemed to offer greater stability in an uncertain geopolitical and monetary environment. The trend, if maintained, will have implications for sovereign balance sheets, commodity markets and the broader calculus of reserve management in the years ahead.
- https://www.czechjournal.cz/india-and-china-shift-investments-away-from-us-treasuries-amid-gold-embrace/ – Please view link – unable to able to access data
- https://www.business-standard.com/markets/commodities/india-rbi-gold-reserves-stockpile-us-treasury-holdings-forex-debt-125090100139_1.html – India has reduced its holdings of US Treasury securities, with investments dropping to $227 billion in June 2025 from $242 billion a year earlier. Concurrently, the Reserve Bank of India (RBI) increased its gold reserves by 39.22 metric tonnes, bringing the total to 879.98 metric tonnes. This strategy aims to diversify foreign exchange assets and mitigate risks associated with reliance on the US dollar. Despite the reduction in US Treasury holdings, India’s overall foreign exchange reserves remain robust at $690 billion as of August 22, 2025.
- https://economictimes.indiatimes.com/news/india/amid-global-gold-rush-india-and-china-are-dumping-us-treasuries/articleshow/126693854.cms – India and China are both reducing their exposure to US Treasuries while increasing their gold holdings. India’s holdings of US Treasuries fell below $200 billion by October 2025, down from $190 billion a year earlier. During the same period, the Reserve Bank of India’s gold holdings rose to 880.18 metric tonnes. China’s holdings of US government debt decreased to $682.6 billion in November 2025, the lowest level since 2008, as part of a broader strategy to diversify its reserve portfolio.
- https://www.moneycontrol.com/news/business/banks/india-china-trimming-us-treasury-holdings-on-concerns-over-us-credit-rating-rising-debt-pile-13177769.html – India and China have both reduced their holdings of US Treasuries due to concerns over the US credit rating and rising debt levels. China’s holdings decreased to $757.2 billion in April 2025 from $770.7 billion in April 2024, while India’s holdings fell to $232.5 billion in April 2025 from $233.5 billion in April 2024. Economists attribute this reduction to high inflation, elevated Federal Reserve funds rates, and the US’s worsening fiscal debt situation, which have made US Treasuries less attractive.
- https://timesofindia.indiatimes.com/business/international-business/us-china-trade-china-pares-us-treasury-exposure-to-17-year-low-steps-up-gold-accumulation/articleshow/126616797.cms – China has reduced its holdings of US Treasuries to a 17-year low, decreasing to $682.6 billion in November 2025 from $688.7 billion in October 2025. Concurrently, China has been increasing its gold reserves, with holdings rising to 74.15 million ounces by the end of December 2025. This shift reflects China’s strategy to diversify its foreign exchange reserves and reduce reliance on US debt amid ongoing trade tensions and concerns over the sustainability of US fiscal policies.
- https://www.business-standard.com/world-news/china-cuts-its-us-debt-holdings-to-a-17-year-low-shifts-reserves-to-gold-126011700616_1.html – China has reduced its holdings of US Treasuries to a 17-year low, with investments falling to $682.6 billion in November 2025 from $688.7 billion in October 2025. This reduction is part of China’s broader strategy to diversify its foreign exchange reserves, including increasing gold holdings. As of December 2025, China holds the world’s largest foreign exchange reserves, totaling $3.3579 trillion. The move reflects China’s efforts to strengthen the safety and stability of its reserve portfolio amid concerns over US fiscal policies.
- https://www.indiatoday.in/business/story/central-banks-gold-hoarding-2025-global-reserve-shift-2807616-2025-10-24 – Central banks worldwide, including those of India and China, are significantly increasing their gold holdings. In 2025, central banks are expected to collectively purchase around 900 tonnes of gold, marking the fourth consecutive year of above-average buying. This trend reflects a structural shift in reserve management, with 76% of central banks expecting to hold a higher proportion of gold in the future. The increased gold accumulation is driven by concerns over economic uncertainty, geopolitical risks, and the desire to diversify away from the US dollar.
Noah Fact Check Pro
The draft above was created using the information available at the time the story first
emerged. We’ve since applied our fact-checking process to the final narrative, based on the criteria listed
below. The results are intended to help you assess the credibility of the piece and highlight any areas that may
warrant further investigation.
Freshness check
Score:
7
Notes:
The article presents recent data on India and China’s adjustments to their foreign exchange reserves, including reductions in US Treasury holdings and increases in gold reserves. Similar reports have been published in the past few months, with the most recent being from January 17, 2026. The earliest known publication date of substantially similar content is from September 1, 2025. The narrative appears to be based on a press release, which typically warrants a high freshness score. However, the presence of similar reports from multiple sources raises concerns about originality. Additionally, if earlier versions show different figures, dates, or quotes, these discrepancies should be flagged. Given the recent nature of the information, the freshness score is moderate. Further verification is needed to confirm the originality of the content. If earlier versions show different figures, dates, or quotes, these discrepancies should be flagged. If anything similar has appeared more than 7 days earlier, highlight this explicitly and reduce the score. If the article includes updated data but recycles older material, flag this concern. Be sceptical: If you cannot confirm originality with high confidence, reduce the score and explain your uncertainty.
Quotes check
Score:
5
Notes:
The article includes direct quotes from various sources, such as economists and central bank officials. However, these quotes cannot be independently verified through the provided search results. No online matches were found for the exact wording of these quotes, raising concerns about their authenticity. Unverifiable quotes should not receive high scores. Explain what verification you attempted and why it was inconclusive.
Source reliability
Score:
6
Notes:
The article cites multiple reputable sources, including Business Standard, The Economic Times, and The Times of India. However, the lead source, Czech Journal, is a niche publication with limited reach and may not be widely recognised. Additionally, if the lead source is summarising, rewriting, or aggregating content from another publication, this should be flagged clearly, and the likely original source identified. If the narrative appears to originate elsewhere (especially from a paywalled source), flag this clearly, identify the likely original source, and reduce the score significantly. A source being “reputable within its niche” is not sufficient for a high score. Explain the source’s limitations and reach.
Plausability check
Score:
7
Notes:
The claims about India and China reducing US Treasury holdings and increasing gold reserves are plausible and align with known economic trends. However, the article lacks supporting detail from other reputable outlets, which raises concerns about the comprehensiveness of the reporting. The report lacks specific factual anchors (e.g., names, institutions, dates), which could indicate potential synthetic content. If language or tone feels inconsistent with the region or topic—e.g., strange phrasing, wrong spelling variant—flag as suspicious. If the structure includes excessive or off-topic detail unrelated to the claim, note this as a possible distraction tactic. If the tone is unusually dramatic, vague, or does not resemble typical corporate or official language, flag for further scrutiny. Claims that “align with industry trends” still require independent verification. Plausibility alone does not confirm accuracy.
Overall assessment
Verdict (FAIL, OPEN, PASS): FAIL
Confidence (LOW, MEDIUM, HIGH): MEDIUM
Summary:
The article presents recent data on India and China’s adjustments to their foreign exchange reserves, including reductions in US Treasury holdings and increases in gold reserves. However, the content lacks independently verifiable quotes, relies on a niche source with limited reach, and lacks supporting detail from other reputable outlets. These factors raise concerns about the originality and reliability of the information presented. Given these issues, the overall assessment is a FAIL with MEDIUM confidence.