Beijing’s ongoing bullion-buying spree comes amid similar efforts by other central banks to move away from the US dollar, against the background of dwindling global economic growth.
China increased its gold reserves for the fourth straight month in March, according to fresh figures released by the People’s Bank of China (PBoC).
Last month’s inflow stood at 11.2 tonnes after the addition of 10 tonnes in February, 11.8 tonnes in January and 9.95 tonnes in December, bringing overall holdings to 1,894 tonnes, or 60.62 million ounces.
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China, the world’s top gold producer and consumer, continues its bullion-buying spree as part of a strategy to shift away from the US dollar.
The drive comes amid similar efforts by other countries, including Russia and Japan, to sell US dollar reserves and treasuries amid their perceived weakness as an investment. Slowing global economic growth and uncertainties over the ongoing trade war between China and the US are also playing a role, according to stock market analysts.
Notably, the PBoC had not reported an uptick in its holdings for over two years, with official figures from November 2018 reflecting those posted in October 2016.
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In January, China had the sixth-largest gold reserves in the world amid reports by the World Gold Council that global central banks had bought a total of 651.5 tonnes last year.
Bloomberg reports that if China continues “to accumulate bullion at the current rate over 2019, it may end the year as the top buyer after Russia”, which has already increased its gold reserves to about 2,149 tonnes.
As a result of the bullion binge, Russia now ranks among the top five gold holders in the world; the US ranks first with some 8,130 tonnes, Germany second with 3,370 tonnes, Italy third with 2,450 tonnes and France fifth with 2,440 tonnes.