China’s central bank continues to buy gold – now for 16 consecutive months!

Mon Mar 09 2026

China’s central bank remains a steady driver of demand in the gold market. According to the latest officially reported data, the gold reserves of the People’s Bank of China (PBoC) increased again in February 2026 – marking the 16th consecutive month. At the same time, the gold price was highly volatile last week: a rapid rise at the start of the week was followed by an equally swift correction before buyers re-emerged around US$5,000 per ounce.

Although the week ended with a loss, the broader picture of central bank buying, geopolitical risks and de-dollarisation debates continues to ensure that gold remains present in many portfolios as a hedging instrument. Current developments also illustrate a pattern market participants have been observing for some time: gold is noticeably supported during Asian trading hours, while later in the day profit-taking or reallocations often set in.

PBoC increases gold reserves again – officially 74.22 million ounces as of end-February

According to the published figures, China’s gold holdings stood at 74.22 million troy ounces at the end of February 2026, compared with 74.19 million troy ounces in January 2026. The reported value of the reserves also rose significantly: at the end of February it was stated at US$387.59 billion, up from US$369.58 billion in January.

These figures are noteworthy for two reasons. First, they document the continuation of a longer accumulation phase in which the PBoC has increased its official gold reserves month after month. Second, the sharp rise in the reserve value stands out, which cannot be explained solely by the (small) increase in volume, but is largely driven by the price performance of gold.

At the same time, it must be emphasised that these are the “officially” reported data. For years, there has been speculation that China’s actual gold holdings could be higher than the published figures suggest. Independent estimates are repeatedly cited as an argument – including assessments indicating that the real holdings could be significantly higher than reported. For market interpretation, this means: even if investors view the official data as a minimum, the PBoC remains relevant as a structural buyer in the background.

Gold price: Asian buying, then a pullback – the week still ended only slightly negative

Alongside the central bank data, the price movement of gold was strongly shaped by geopolitical news flow. At the start of the week, gold initially jumped as the US-Iran conflict escalated and at times rose above US$5,400 per ounce. However, this impulse did not last long: as early as Tuesday, a significant wave of selling pushed the price back down.

Notably, buyers emerged around US$5,000. The market report notes that “dip buyers” used this zone to build or add to positions. As a result, the correction was painful for short-term traders, but it did not lead to a broad sell-off. By the end of the week, gold closed at US$5,171 – a 2% decline week on week. This was only the second weekly loss this year and the first after four weeks of gains.

Another detail from the week: the gold price was “bid” – i.e., supported to the upside – in every Asian trading session and then eased later in the day. This intraday pattern can have various causes, including regional demand, tactical positioning or hedging activity. However, it shows how strongly gold is currently oscillating between the need for safety and short-term risk adjustment.

Why central banks continue to buy gold – and what that means for the coming months

Many media outlets report that central banks currently have “no shortage of reasons” to hold or increase gold. Three main themes are cited: first, heightened geopolitical tensions; second, fiscal concerns in major economies; and third, the ongoing trend toward de-dollarisation, i.e., reducing dependence on the US dollar in reserve structures and payment flows.

For the gold market, this combination is important because it responds less to short-term price signals than to strategic portfolio considerations. Central bank purchases can therefore act as a stabilising factor – especially in phases when speculative positions are being reduced or macroeconomic expectations (rates, dollar, risk appetite) shift quickly.

At the same time, last week underscores that gold does not automatically and permanently benefit from geopolitical shocks. The move above US$5,400 at the start of the week and the subsequent decline highlight how quickly “crisis premiums” can emerge and then disappear again. For market psychology, this may mean that traders act more defensively in the short term, while longer-term players – including central banks – continue to view the metal as a strategic building block.

Source: https://goldinvest.de/