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Decoding China's Record-Breaking Gold Buying Spree
M
Moneycontrol•12-10-2026, 15:19
Decoding China's Record-Breaking Gold Buying Spree
- •The People's Bank of China extended its gold-buying streak to 23 consecutive months, purchasing 23 tonnes of gold in September alone.
- •China imported over 1,000 tonnes of gold worth a record $158.8 billion in the first eight months of 2026.
- •Beijing is actively reducing its dependence on the US dollar and US Treasuries by diversifying foreign-exchange reserves.
- •A prolonged property market slump and weak domestic equity performance have driven Chinese households toward safe-haven gold assets.
- •Strong structural demand from Chinese consumers and central bank purchases continue to provide vital global support for gold prices.
Key Questions Answered
The People's Bank of China has extended its gold-buying streak to diversify its foreign-exchange reserves away from the US dollar, reduce dependence on US Treasuries, and mitigate risks associated with holding overseas reserves following Western sanctions on Russia.
A prolonged property-market slump, a weak benchmark CSI 300 index, and low government bond yields have reduced confidence in traditional household wealth, driving citizens toward gold as a safe-haven asset and increasing consumer imports.
Chinese demand has served as a crucial source of structural support for bullion prices, helping offset pressures from elevated US bond yields and expectations of further Federal Reserve tightening.
