In a move that signals a clear shift away from the U.S. dollar and toward safe-haven assets, the People’s Bank of China (PBOC) revealed it continued purchasing gold in July, marking the ninth consecutive month of additions to its bullion reserves.
According to official data released by the bank, China’s gold reserves rose to 73.96 million fine troy ounces, up slightly from 73.90 million ounces in June. The total value of the reserves increased to $243.99 billion, compared to $242.93 billion in the previous month, supported by the ongoing rally in global gold prices.
A Long-Term Strategic Direction
China resumed gold purchases in November 2024 after a six-month pause, but has since followed a more consistent and deliberate accumulation path. This underscores a broader strategic pivot in managing its foreign reserves, especially amid growing geopolitical tensions, rising East-West economic competition, and increasing concerns over dependency on the U.S. dollar.
Zain Vawda, senior analyst at OANDA, told Reuters:“China is sending a clear signal to global markets that gold is not just a reserve asset, but a fundamental component of a broader strategy to shield its economy from geopolitical and dollar-based risks.”
Steady Buying Despite High Prices
Even as gold prices hit record highs in Q2 2025—exceeding the $3,500/oz threshold—China’s purchasing spree did not slow. According to Bloomberg, total gold acquisitions since November 2024 now exceed 34 tonnes, with a consistent monthly average of around 2.2 tonnes.
Responding to U.S. Economic Pressure
The trend comes amid rising pressure from U.S. economic policies, particularly the newly expanded tariff regime targeting Chinese imports. Analysts believe this gold-buying campaign is part of Beijing’s broader plan to enhance monetary and sovereign autonomy away from the Western financial system.
It is also widely interpreted as a support mechanism for China’s ambition to internationalize the yuan and establish it as a credible trade-settlement currency, especially among BRICS nations and participants in the Belt and Road Initiative.
What’s Next: Could Gold Reach $4,000?
With central bank demand rising—led by China—a recent Reuters poll predicts average gold prices in the second half of 2025 to reach $3,220/oz, with bullish scenarios projecting a move toward $4,000/oz if geopolitical tensions escalate or global monetary confidence declines further.
China’s persistent gold buying reflects a growing global trend among central banks to restructure their reserve portfolios. As Western sovereign debt instruments face heightened volatility, gold is regaining its role as a cornerstone of monetary sovereignty. The question now is: Will other BRICS members follow suit? And how will Washington respond?
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