China Halts Gold Buying for Second Consecutive Month
China’s central bank, the People’s Bank of China (PBOC), has paused its gold accumulation for the second consecutive month, keeping its reserves steady at 72.8 million troy ounces. This pause ends an 18-month streak of continuous gold purchases that began in November 2022 and contributed to record-high gold prices.
PBOC Pauses Gold Accumulation After 18-Month Buying Streak
China’s central bank, the People’s Bank of China (PBOC), chose not to increase its gold reserves for the second month in a row in June, as reported by the World Gold Council. The bank’s bullion holdings remained steady at 72.8 million troy ounces at the end of the month, with official data indicating that China’s gold reserves stand at 2,264 tonnes, equivalent to this amount.
The Chinese central bank halted its gold accumulation in May, ending an 18-month streak of consistent monthly purchases that began in November 2022 and contributed to record-high gold prices. This decision to pause could be influenced by several factors. Market analysts suggest that the PBOC might be adjusting its strategy due to fluctuating global gold prices, which have shown considerable volatility. Additionally, domestic economic conditions, such as inflation and growth rates, may also be influencing the bank’s strategy.
Some analysts speculate that despite the official pause, China might still be purchasing gold discreetly, given the current high prices. In a recent interview with Kitco News, Christopher Vecchio, Head of Futures & Forex at Tastylive, noted regional data indicating China’s gold purchases in late June. Vecchio also mentioned that while central bank demand remains supportive of gold, it no longer drives the market as it did earlier in the year, with attention now shifting towards the Federal Reserve’s monetary policy.
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