China Ramps Up Gold Purchases, Reserves at 75.4M Ounces
China’s central bank added 480,000 ounces of gold to its reserves in June — the largest monthly purchase since October 2023 — extending its buying streak to 20 consecutive months as global bullion prices tumbled more than 10%. The country’s official gold reserves now stand at 75.44 million troy ounces (approximately 2,346 metric tonnes), according to data released Tuesday by the State Administration of Foreign Exchange (SAFE).
The accelerated accumulation underscores China’s strategic push to diversify its foreign-exchange holdings away from U.S. dollar-denominated assets, even as a stronger dollar and hawkish Federal Reserve signals weighed on global gold markets.
Context & Background
China’s central bank has been steadily increasing its gold reserves since November 2024, when it resumed purchases after a pause. The current 20-month buying streak follows a previous 18-month accumulation cycle that ended in late 2023. As of end-2025, gold accounted for only about 8.8% of China’s official international reserves, compared to the global central bank average of 27%, according to Wang Qing, chief macro analyst at Dongfang Jincheng. This suggests “considerable room for further increases,” he noted.
The gold purchases are widely viewed as part of a broader de-dollarization trend among BRICS nations. In 2025, global central banks purchased over 1,100 tonnes of gold — the largest annual increase in 70 years — as countries sought alternatives to dollar-dominated financial infrastructure.
Key Developments
According to Caixin Global, the PBOC’s June purchase of 480,000 ounces (roughly 15 metric tonnes) marked the largest single-month increase since October 2023, when 740,000 ounces were added. The monthly purchase volume has now expanded for four consecutive months, indicating an accelerating pace of accumulation.
The buying came during a brutal month for gold prices. International gold prices fell 11.65% in June — the worst monthly performance since October 2008 — temporarily dipping below $4,000 per troy ounce from about $4,540/oz, according to Mezha.net, citing Reuters data. A strengthening U.S. dollar and expectations that the Federal Reserve would maintain elevated interest rates weighed heavily on the precious metal.
Despite the increase in physical holdings, the value of China’s gold reserves fell to $303.72 billion at end-June, down from $340.75 billion in May, due to the sharp price decline. China’s total foreign-exchange reserves also fell by $26 billion (0.75%) to $3.4163 trillion in June, snapping two months of gains, as reported by City News Service.
SAFE attributed the decline to “the combined effects of exchange rate conversion and asset price changes,” noting that the U.S. dollar index rose in June while global financial asset prices showed mixed performance.
Analysis & Implications
Wang Qing of Dongfang Jincheng told National Business Daily that the direct reason for the central bank accelerating gold purchases in June may be that international gold prices fell for the fourth consecutive month, with a decline of 12.44% — significantly faster than May’s 2.03%. He described the PBOC’s strategy as price-sensitive buying, taking advantage of the downturn to accumulate at lower levels.
“Gold is a widely accepted ultimate means of payment globally,” Wang said. “The central bank’s increase in gold reserves can enhance the credit of sovereign currency and create favorable conditions for the steady advancement of RMB internationalization.”
Wen Bin, chief economist at China Minsheng Banking Corp., noted that the U.S. dollar’s strength is attributed to expectations of further interest-rate increases, hawkish Fed remarks, and resilient U.S. economic data. Looking ahead, he said exports will continue to play a fundamental role in China’s balance of payments, supported by global AI capital expenditure cycles, diversified trade market layouts, and global energy transition demand.
The sustained gold buying sends several signals to global markets. First, it demonstrates China’s conviction in gold as a strategic reserve asset, potentially providing price support despite dollar strength. Second, it reinforces Beijing’s commitment to reducing dependence on U.S. dollar assets amid ongoing geopolitical tensions. Third, each monthly purchase strengthens the case for the renminbi as a credible international reserve currency backed by physical gold.
What’s Next
With gold’s share of China’s reserves at roughly one-third the global average, analysts expect the PBOC to continue its accumulation for the foreseeable future. Key questions remain: Does China have a specific target for gold’s share of reserves? Will the pace of buying slow if gold prices rebound sharply? And how will China’s sustained demand impact the global gold market?
China reports its gold reserves monthly but does not disclose purchase prices or detailed transaction data, leaving markets to speculate on the full scope of its strategy. What is clear is that the world’s second-largest economy is steadily building a gold buffer — one that serves both as a hedge against geopolitical risk and a foundation for its long-term currency ambitions.