China Extends Gold Buying as PBOC Adds to Reserves 12th Month

PBOC extends its quiet gold accumulation

China extends gold buying as the People’s Bank of China adds to reserves for the 12th straight month, reinforcing its role as one of the most consistent official sector buyers in the bullion market. Fresh data for October show holdings rising to about 74.09 million fine troy ounces, up from 74.06 million ounces in September, an increase that leaves reserves roughly 1.8 percent higher than a year earlier. The value of those holdings climbed to about $297.2 billion from $283.3 billion, supported by elevated prices and incremental purchases.

A measured but persistent buying pattern

The absolute tonnage added in October is modest, yet the pattern is strategic. By extending purchases for a 12th month, the PBOC signals that gold remains a core component of its long term reserve mix. The central bank has chosen a gradual, recurring approach rather than large, disruptive transactions, a style that helps limit market noise while steadily lifting its bullion share. For Tredu readers, the message is that China’s reserve managers prefer accumulation on a rolling basis to tactical trading around short term moves.

De-dollarisation and diversification logic

The PBOC’s stance aligns with a broader push among emerging markets to diversify away from concentrated exposure to the U.S. dollar. Gold offers liquidity, no credit risk and insulation from sanctions; those traits have gained weight in policy circles over recent years. While China still holds substantial dollar assets, repeated additions to gold reserves suggest a calibrated reserve diversification strategy: gradually increase the share of non dollar, non sovereign assets without triggering volatility in core FX markets. The continuing streak underscores that this is policy, not optics.

Support for bullion near elevated prices

China’s central bank adds gold to reserves even with prices trading near historic highs, a signal that authorities view bullion as strategically valuable rather than merely opportunistic. Persistent official demand has helped underpin the market during bouts of investor rotation, absorbing supply when ETF flows or speculative interest soften. For miners and physical traders, the knowledge that a large, price tolerant buyer is present in the background shapes expectations about downside depth and long term support levels.

Reading the numbers in context

October’s move lifts China’s declared holdings modestly in volume terms but keeps them below levels implied by some private estimates of potential undisclosed buying. Analysts caution that transparency remains limited; even so, the published series shows a clear trend: a steady climb from the low 70 million ounce range toward the current 74.09 million. Measured against the size of China’s overall reserves, gold still accounts for a relatively small slice, which leaves room for further increases if policymakers decide to close the gap with some Western peers.

Market reaction and investor takeaways

The announcement alone is not enough to drive a sharp price spike; markets had come to expect continued buying after earlier monthly updates. However, confirmation of a 12th consecutive addition reinforces three themes that investors track closely: the resilience of central bank demand, the appeal of gold as a geopolitical hedge, and the possibility that any deeper correction will meet structural buying interest. Portfolio managers looking at reserve behaviour see China’s stance as one more argument for treating bullion as a long horizon stabiliser rather than a narrow tactical trade.

Significance for global central bank flows

Beyond China, several emerging market central banks have been adding gold to their reserves in response to currency volatility and rising geopolitical risk. The PBOC’s extended streak helps legitimise that trend, signalling that allocating to bullion is consistent with a major economy’s reserve policy. If other banks follow a similar path, aggregate official sector demand could remain a meaningful pillar in the gold market, even if retail or ETF flows fluctuate with macro headlines. That backdrop supports a structural bid under prices while keeping focus on how large buyers calibrate future purchases.

Risks, limits and what could change

There are constraints. Faster domestic growth initiatives, shifting capital flows or efforts to manage the yuan could require the PBOC to prioritise liquidity in other assets at times. A sustained drop in gold prices would test tolerance for mark to market volatility on a larger bullion base, while a sharp rally could slow the pace of additions to avoid chasing the market. Changes in global rates, dollar trends or sanctions regimes could also alter the calculus. For now, the choice to continue buying into a high price environment signals comfort with both the level and the role of gold in China’s reserve framework.

Bottom line

China Extends Gold Buying as PBOC Adds to Reserves 12th Month, reinforcing a deliberate strategy of reserve diversification and a steady official bid beneath the bullion market. The latest data confirm that gold remains central to Beijing’s long term financial security toolkit, a signal that investors, miners and policymakers worldwide cannot ignore.