China has intensified its gold-buying spree, importing more than 1,000 tonnes of gold worth a record $158.8 billion in the first eight months of 2026. This surge exceeds the $96.5 billion and 886 tonnes imported in all of 2025, according to customs data. The People's Bank of China (PBOC) extended its gold-buying streak to 23 consecutive months, with a significant purchase of around 23 tonnes in September, marking its largest monthly acquisition in nearly three years.
Analysts point to several drivers behind China's gold rush. Carsten Menke of Julius Baer Group highlighted the political motive, noting China's desire to reduce dependence on the US dollar and US Treasuries. The freezing of Russia's central-bank assets in 2022 underscored the risks of holding reserves overseas, prompting China to diversify its foreign-exchange reserves. Meanwhile, households are turning to gold as a safe-haven asset amid a prolonged property-market slump and weakened confidence in traditional stores of wealth.
Chinese demand has provided crucial support to gold prices, despite elevated US bond yields and expectations of further Federal Reserve tightening. Ewa Manthey of ING Bank emphasized that Chinese buying has become a structural support for gold prices. Although gold prices fell over 8% in September to around $4,176 an ounce, analysts like Aakash Doshi of State Street Investment Management expect prices to rebound to $4,750-$5,500 per troy ounce by the end of the first quarter of 2027.
Globally, gold demand remained robust, with central banks buying 289 tonnes in the second quarter of 2026. The World Gold Council reported that first-half demand rose 2% to 2,522 tonnes, worth a record $380 billion. While jewelry demand declined due to high prices, investment and Asian buying are expected to sustain demand in the second half of the year. In India, gold prices have seen slight fluctuations, with MCX gold futures for December 4 delivery falling 0.46% to Rs 1,50,800 per 10 grams.