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China Central Bank Extends Gold Buying Streak to 13 Months Amid Price Pullback

2025-12-08 09:58:10 | 浏览 434

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In a continued show of confidence in gold as a strategic asset, the Peoples Bank of China (PBOC) has expanded its gold reserves for the 13th consecutive month, adding 30,000 troy ounces in November to reach a total of approximately 74.12 million ounces, valued at over $310.6 billion. This persistent accumulation underscores Beijings efforts to diversify its foreign exchange holdings and bolster its influence in the global precious metals market, even as spot gold prices consolidate after a volatile year.


The latest data, released by the PBOC on December 7, reveals that gold now constitutes more than 9% of Chinas total foreign exchange reserves, up over three percentage points from a year ago. This marks the longest unbroken buying spree since the central bank resumed significant purchases in November 2024, following a pause amid geopolitical tensions including Russias invasion of Ukraine and subsequent asset freezes by Western nations. The move comes at a time when global central banks, after a relatively quiet mid-year period, ramped up acquisitions in October, according to the World Gold Council.


Spot gold prices, which surged to record highs above $4,000 per ounce in October, have since moderated but remain firmly above that psychological threshold. Analysts attribute this resilience to expectations of a Federal Reserve rate cut at its December 9-10 meeting and a potentially more dovish stance from the next Fed chair. "Golds trajectory suggests it could deliver its strongest annual performance since 1979," noted market observers, highlighting the metals role as a hedge against dollar risks and inflation.


In parallel, the PBOC is extending olive branches to international counterparts, proposing that foreign central banks store gold reserves in China to enhance bilateral ties. Cambodia has already expressed interest, signaling Beijings growing clout in the commodities arena. While the exact motivations remain opaque—PBOC officials rarely comment on reserve strategies—this strategy aligns with broader de-dollarization efforts and aims to mitigate vulnerabilities exposed by frozen Russian assets.

Market reaction has been muted, with gold futures edging up 0.5% in early Asian trading on Monday. However, the sustained PBOC buying could provide a floor for prices, especially if U.S. policy shifts toward easing. Investors are watching closely, as Chinas voracious appetite—now rivaling that of major producers—may reshape global supply dynamics in 2026.

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