Macro
China's central bank boosts gold reserves for 16th month, hitting 72.58 million troy ounces amid economic uncertainties.
By Bill Bullington
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China's central bank continued its gold-buying spree in January, adding to its reserves for the 16th consecutive month. The People's Bank of China increased its bullion holdings by approximately 390,000 troy ounces last month, bringing the total to 72.58 million troy ounces, equivalent to about 2,257 tons. This consistent accumulation of gold by China's central bank has been a key factor in supporting the precious metal's surge to a record high.
The relentless increase in China's gold reserves has not only contributed to the record-high spot gold prices but has also underscored the market's anticipation of potential US interest-rate cuts later this year. Central-bank buying, especially by China, has played a significant role in bolstering gold's strength in the global market. The ongoing demand for gold in the Chinese domestic market remains robust, with buyers undeterred by high prices. Economic uncertainties in China have prompted a flight to safe-haven assets like gold, further driving demand.
Amid concerns over China's uneven economic recovery, investors are turning to gold as a safe-haven asset to hedge against volatility and uncertainty. The persistent buying of gold by the People's Bank of China reflects a broader trend of seeking stability and security in the face of economic challenges. The nation's gold accumulation strategy aligns with its efforts to diversify reserves and mitigate risks in a volatile global economic environment.
Finance GPT
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