China, the world’s second-largest economy, is continuing to increase its gold reserves, making gold a key part of its long-term economic strategy. Official data shows that China made another major gold purchase in June, marking its 20th consecutive month of buying. Although gold prices have fallen globally, China has continued to add more gold to its reserves, suggesting that its focus goes beyond safe investment.
Biggest Gold Purchase in Over Two Years
According to a Reuters report, China’s central bank made its biggest monthly gold purchase in more than two and a half years during June. By the end of June, China’s gold reserves had reached 75.44 million net troy ounces, up from 74.96 million net troy ounces in May 2026.
The 480,000-troy-ounce increase (around 15 metric tonnes) is the largest monthly rise since October 2023. In comparison, the People’s Bank of China added 320,000 troy ounces to its reserves in May.
Buying Continues Despite Falling Gold Prices
China has continued buying gold even as international gold prices have declined. As a result of the price drop, the value of China’s gold reserves fell to $303.72 billion at the end of June, compared with $340.75 billion in May.
Spot gold prices dropped by 11.65% in June, marking their biggest monthly decline since October 2008. During the month, gold prices briefly fell below $4,000 per ounce.
Why Is China Buying So Much Gold?
China’s continued gold purchases are seen as part of its long-term economic and financial strategy. The country wants to strengthen its economy and increase its influence in the global financial system. At the same time, Beijing is trying to reduce its dependence on the US dollar by increasing the share of gold and other safe assets in its foreign exchange reserves.
Gold is considered a safe-haven asset during financial crises, geopolitical tensions and global uncertainty. Unlike currencies, gold is not controlled by any single country, making it a reliable reserve asset in difficult times.
What Could Be the Global Impact?
China’s steady gold buying could help keep global gold prices elevated over the long term. As one of the world’s largest buyers, China’s growing demand for gold could continue to influence international prices and have a wider impact on the global economy.
First published on: Jul 07, 2026 08:16 PM IST
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