China's central bank suspended gold reserves replenishment in May amid record spot gold prices. This happened for the first time since the end of 2022.
According to official data, the volume of China’s gold reserves in May remained at the level of April at 72.8 million troy ounces (2,264 tons). The value of China's gold reserves rose to $170.96 billion by the end of the month from $167.96 billion at the end of April, reflecting changes in global gold prices.
Safe haven demand, driven by geopolitical and economic uncertainty, contributed to a rally in gold from March to May, bringing spot prices to a record $2,449.89 per ounce by the end of May.
Demand for gold from global central banks has been elevated for two years, supporting the prices. According to the World Gold Council (WGC), China became the largest official sector buyer of gold in 2023, purchasing 7.23 million ounces (225 tons), the largest annual total since 1977.
Experts estimate that China has not yet finished its gold buying, but is showing restraint so far, unwilling to pay such record prices.
Until November 2022, the People's Bank of China had not replenished gold reserves for 37 months after 10 months of consecutive purchases. Prior to that, the resumption of gold purchases was observed in December 2018 after a hiatus of more than two years.
Hélène Tarin, Editor in Chief of the Asian Bureau, Rough&Polished
