Bank Centra China has reportedly succeeded in buying gold for 23 months without stopping. In fact, this country has imported this precious metal in quantities that have never been done before. This gold buying action reflects Beijing's efforts to reduce dependence on the United States Dollar as well as the lack of safe investment options for households in the country.

Quoted from CNBC International on Monday 12 October 2026. China's Central Bank added gold reserves of around 23 tons in September. According to data taken from the State Administration of Foreign Exchange, this is the largest monthly transaction in almost three years and extends the record buying period that has been held since at least 2015 Data from customs shows China recorded a record expenditure of US $ 158.8 billion to purchase more than 1,000 tons of gold in the first eight months of 2026. This figure exceeds the import value of $ 96.5 billion and the volume of 886 tons recorded throughout 2025

"Gold imports by China reached a record high in the first eight months of this year," said Aakash Doshi, head of gold strategy at State Street Investment Management. "The surge in gold price premiums in China's domestic market indicates strong winter seasonal demand," he said

Doshi predicts that gold prices will rise to the range of US$4,750 to US$5,500 per troy ounce by the end of the first quarter of 2027. This is driven by strong demand.

In fact, this accumulation of precious metals occurred amidst a decline in gold prices. Gold prices decreased by at least 8% in September to around US $4,176 per ounce, after reaching up to US $5,500 in January.

Doshi predicts that the price of gold will rise to the range of US $4,750 to around US $5,000 per try ounce by the end of the first quarter of 2027. This is undeniably due to demand which is still strong.

Why is China buying up so much gold? It was mentioned how Western governments froze the assets of Russia's Central Bank following its invasion of Ukraine in 2022. This highlights how reserves held abroad can be limited in times of geopolitical tension, while gold reserves held within the country itself remain safe and unaffected. A number of data are also shown. Where China has started to release some of its asset ownership in the form of United States government bonds. Referring to US Treasury Department data. Its value has plunged in 18 years to US $ 618 billion in July, as China continues to diversify its foreign exchange reserves. China's demand is also driven by the branding of gold as the safest hedge asset so far in the country, which is worried about the unstable economy, flocking to carry out transactions in Jewelry, Gold Bars and Gold Coins. Domestic investors have few investment alternatives because the property market, which was once the main choice for storing household wealth, is currently in a long period of downturn. The benchmark CSI 300 index will fall by around 8% in 2026, in stark contrast to the S&P index which recorded an increase of 13%

Yields on Bank Deposits and Bonds were also low due to the lack of loan demand. Yields on 1-year Chinese government bonds fell to 1.2%, compared with the US figure of around 4.46% This purchase made by China is also believed to be a plan to build a more focused domestic gold market. The Minister of Security estimates that the Central Bank has purchased almost 190 tons of gold by the end of August this year, including 110 tons that were not previously reported.

Helping to Maintain Gold Prices? China's demand for gold has also helped gold prices withstand pressure, which should have the impact of a deeper price decline, considering US bond yields are holding back demand for the precious metal. What usually happens is that the price of gold decreases when interest rates rise "Chinese purchases have been an important source of structural support for gold prices," said commodity strategist at ING Bank, Ewa Manthey. Menke also said the same thing. He said that gold prices remain above their levels in the summer, despite expectations of interest rates and bond yields increasing more significantly while the Fed has raised interest rates again in 2026 Meanwhile, according to Hansen, any renewed confidence in Chinese property and equities could blunt demand for gold, as well as the weakening of the Chinese currency causing gold prices to rise again domestically or higher interest rates, making savings an attractive option. A bigger shift would occur if central banks lose interest in diversifying reserves and geopolitical tensions ease.

"(However) both of these things do not appear to be happening in the near future," he explained.

According to the World Gold Council, the fifth largest gold holding country in the world had 2,387 tons in August. That figure is less than a third of the US's.

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