China Buys Gold yet Again, Consolidates 10-Month Purchase Streak

The People’s Bank of China has continued to purchase gold to add to the country’s foreign reserves, according to official data. The purchase, albeit marginal, fuels China’s 10-month streak of acquisitions, even at record prices.

China Continues to Purchase Gold Even at Record Prices

Countries have started to turn to gold again, given the current climate of international uncertainty and the risks associated with intervention by the Federal Reserve in the U.S. The People’s Bank of China (PBOC) has recently issued data confirming that the country continued to add gold to its foreign reserves during August.

According to official data, the institution added 0.06 million troy ounces last month, bringing its gold reserves to 74.02 million troy ounces. The purchase, albeit marginal, is a statement that signals China’s interest in diversifying its reserves and committing to gold purchases even at record prices.

With the purchase, China consolidates a 10-month streak of gold acquisitions that began back in November 2024, having acquired nearly 1.22 million troy ounces during this period.

Adrian Ash, head of research at Bullion Vault, stressed the relevance of China’s interest in gold. He stated:

Beijing’s continued accumulation is a clear signal of its faith in gold as a long-term reserve. That also supports confidence in gold among China’s private households and investors.

Gold has been on a tear this year, given a series of economic factors, which include economic uncertainty caused by the Trump Administration’s attack on the Federal Reserve’s independence and the expectation of a negative effect of tariffs on the U.S. economy.

A recent report by Goldman Sachs assessed that gold prices could rise to $5,000 in a scenario where President Trump’s actions undermine the independence of the Federal Reserve.

While China’s purchase rush has slowed down in terms of quantity, the underlying factors motivating these purchases still exist, as the country has been reducing its exposure to U.S. debt and increasing its gold holdings at the same time. This signals a need for diversification and protection from its large U.S. dollar exposure.

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