China Adds 650,000 Ounces of Gold in Biggest Monthly Buy Since 2023
China's central bank purchased 650,000 troy ounces (about 20 tonnes) of gold in August, the largest monthly addition since 2023, bringing reported holdings to 76.73 million troy ounces. The buy extends the People's Bank of China's streak of monthly increases to 22 months and lifted the reported value of its gold reserves to $350.08 billion.
Why It Matters
The continued accumulation highlights a multiyear shift in reserve composition as policymakers seek assets less vulnerable to external restrictions, a concern heightened after the freezing of roughly $300 billion in Russian reserves. It also comes amid a wider wave of central-bank bullion buying that has pushed global official purchases to record levels.
Key Facts
- August purchase: 650,000 troy ounces (≈20 tonnes)
- July purchase: 640,000 troy ounces
- Consecutive monthly buying streak: 22 months
- Total reported holdings: 76.73 million troy ounces (up from 76.08 million in July)
- Reported value of China's gold reserves: $350.08 billion (up from $306.35 billion a month earlier)
The People's Bank of China increased its gold reserves by 650,000 troy ounces in August, roughly 20 tonnes, according to data the central bank released Monday. That monthly addition topped July's 640,000-ounce purchase and marks the 22nd straight month of increases — the longest uninterrupted run since China started publishing monthly reserve data. Reported holdings now stand at 76.73 million troy ounces, up from 76.08 million in July.
The reported dollar value of those holdings rose to $350.08 billion from $306.35 billion the prior month, a gain driven largely by higher bullion prices rather than new tonnage alone. Gold now constitutes nearly 10% of China's roughly $3.4 trillion in foreign-exchange reserves, a share substantially lower than the roughly 60% to 70% allocation reported for the Federal Reserve and other major Western central banks.
Policy-makers' interest in bullion has been shaped in part by the fallout from Russia's 2022 invasion of Ukraine, when about $300 billion of Russian central bank reserves were frozen. That episode convinced some reserve managers that dollar assets can be made inaccessible, while gold held domestically cannot, a point underscored by Gu Fengda, chief analyst at Guoxin Futures, who described China's accumulation as "a highly strategic and forward-looking deployment." The World Gold Council reported a record 288.9 tonnes of official sector purchases in the second quarter, up 62% from a year earlier, with Poland leading additions at 51 tonnes and countries including Uzbekistan, Kazakhstan, Jordan and the Czech Republic also buying.
Market dynamics have been mixed. Gold climbed nearly 10% in August after the U.S. Treasury on Aug. 19 said it would at least double buybacks of long-dated bonds to $4 billion per operation, a move traders interpreted as easing pressure on U.S. borrowing costs and that briefly weakened the dollar. The rally has since cooled: gold traded around $4,395 to $4,428 an ounce on Monday and Tuesday, pressured by stronger-than-expected U.S. jobs data that lifted the implied odds of a Federal Reserve rate increase at the Sept. 15-16 meeting to nearly 60% according to CME's FedWatch tool. Higher interest rates raise the opportunity cost of holding non-yielding bullion, leaving a near-term price outlook driven by traders' bets on Fed action even as central banks continue buying over a much longer horizon.