Beijing's Gold Buying Appetite Intact
Despite pausing its gold purchases in May and June, China remains eager to acquire more of the precious metal. Its bullion holdings are still relatively low compared to its overall reserves, indicating that Beijing sees gold as a strategic asset despite recent fluctuations in its price.
China's Long-Term Gold Strategy
China has been aggressively increasing its gold reserves in recent years. It took the country nine years to raise the share of gold in its total reserves from 18% in 2015 to 49% today. This suggests that Beijing has a long-term strategy to diversify its reserves and reduce its dependence on foreign currencies.
China's central bank is likely to resume its gold purchases in the coming months. The pause in May and June was likely due to a combination of factors, including price sensitivity and a desire to support the domestic currency. However, China's long-term needs for gold remain unchanged, and it is expected to continue buying the precious metal aggressively in the future.
Comments