China's gold reserves continued their rise by the end of December, recording approximately 74.15 million ounces, compared to 74.12 million ounces in November, reflecting the continued pace of official purchasing by the Chinese Central Bank.
Data showed that the total value of China’s gold reserves rose to about $319.45 billion by the end of December, versus $310.65 billion in November, driven by rising global prices alongside the increase in quantities added to the reserve.
This development comes within a continuous buying cycle that began in November 2024, during which central bank purchases played a pivotal role in supporting gold prices over the past year, with China topping the list of prominent official buyers globally.
In this context, speculation is mounting that Beijing may be purchasing quantities of gold exceeding the reported figures, raising questions about the true volume of its actual purchases.
As the new year begins, fiscal pressures in major economies, along with accelerating trends to reduce reliance on the dollar, are likely to continue pushing central banks to bolster their gold holdings, indicating that this price-supporting factor will persist in the coming period.
Regarding price movement, gold took a breather after a strong start to the year, retreating by about 0.7% to settle near the $4,465 per ounce level, after touching $4,441 earlier in the trading session, before witnessing a limited rebound amidst selling pressures at high levels.
The bullish trend in precious metals is considered one of the most consensual bets in the markets at the start of the year; however, this one-sided consensus may involve risks when price corrections occur, calling for caution in dealing with temporary waves of decline.
The Central Bank of China continues to bolster its gold reserves for the fourteenth consecutive month, reaffirming continued official demand for the precious metal despite prices reaching record levels.
According to data cited by Bloomberg, gold stocks at the People's Bank of China rose by about 30,000 ounces last month.
Thus, China's total purchases since November 2024, with the launch of the current buying cycle, reach about 1.35 million ounces, equivalent to 42 tons.
Despite the sharp price volatility gold witnessed in recent weeks following its recording of new historic peaks in the autumn of last year, the metal achieved its best annual performance since 1979, driven by central bank purchases, escalating geopolitical tensions, and growing hedging operations against currency devaluation and sovereign bond risks.
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