National Bank of Kazakhstan Sells Gold to Rebalance Reserves

The National Bank of Kazakhstan is transitioning from a major gold buyer to a seller to rebalance its foreign exchange reserves. Deputy Governor Aliya Moldabekova announced that the bank intends to reduce the share of gold in its total reserves from approximately 78% to 75% by the end of 2026.

This strategic shift is driven by high U.S. Treasury yields, which have increased the appeal of the U.S. dollar relative to non-yielding gold. Moldabekova stated that the current concentration of gold makes the bank's holdings resemble a "single-asset portfolio," necessitating a move toward greater liquidity. The bank currently holds 386 tons of gold and plans to reach its target through a combination of selling physical gold and selling options.

Despite recent market volatility linked to the U.S.-Iran war, the bank expects gold prices to rise slightly. Moldabekova indicated that the bank will not plan beyond the initial 75% target, preferring to monitor the situation once that level is achieved.