Philippine central banker says time to 'take profit' on gold

The Philippine central bank should sell some of its “excessive” gold holdings with the precious metal set to retreat further from record highs as safe-haven demand eases, according to a policymaker.

Gold accounts for about 13% of the Bangko Sentral ng Pilipinas’ gross international reserves, Monetary Board member Benjamin Diokno said in an interview on Monday in Kuala Lumpur.

That’s already more than other central banks in the region, he said on the sidelines of the Bloomberg Business Summit at Asean.

$109 billion

“Our holdings of gold are already excessive,” said Diokno, a former BSP governor. Ideally, he said the precious metal should be anywhere between 8%-12% of the central bank’s reserves, which stood at about $109 billion as of September 2025, the most in almost a year.

With the BSP having bought gold at around $2,000 an ounce, and bullion hitting a record high at nearly $4,400, “shouldn’t you sell already?” Diokno said.

“What will happen if the price goes down?”

Gold edged higher on Tuesday after falling below $4,000 an ounce overnight as progress on a US-China trade deal sapped demand for safe-haven assets.

The precious metal has pulled back decisively from a record above $4,380 an ounce last week following a blistering rally. It’s still up more than 50% this year, with central-bank buying helping provide support. 

Diokno, who is currently a member of the BSP’s rate-setting body, said there was still debate at the BSP on whether it should accumulate more gold or if it was time to take profit.

Earlier this year, BSP Governor Eli Remolona said the central bank doesn’t bet on gold price movements, pointing out that it’s a very poor investment. “It’s risky and the average return is negative,” Remolona said in March.

But as part of a large portfolio, holding gold provides a good hedge, he said then.

Criticism

In 2024, the BSP sold gold which later rallied, triggering criticism from the public over what some say was opportunity cost.

The BSP responded, saying the move was part of its active management of the country’s gold reserves.

Diokno said the BSP has started to spread out where it keeps its gold holdings. The central bank recently shifted a small portion to France while the bulk remains in London.

The BSP is also looking to diversify currencies in its foreign exchange reserves.

While most of its war chest is still denominated in US dollars, Diokno said they could explore having euros too. It also previously held Japanese yen and Australian dollars.