China has significantly ramped up its gold imports, surpassing 1,000 tonnes in the first eight months of 2026, worth a record $158.8 billion. This figure already exceeds the 886 tonnes imported in all of 2025, which were valued at $96.5 billion. The People's Bank of China (PBOC) also made its largest monthly gold purchase in nearly three years, buying about 23 tonnes in September. This marks the central bank's 23rd consecutive month of buying.
The surge in gold buying is driven by China's efforts to reduce its dependence on the US dollar. Carsten Menke of Julius Baer Group noted that the freezing of Russia's central bank assets in 2022 highlighted the risks of holding national reserves in foreign assets. China has also cut its holdings of US Treasuries, which fell to an 18-year low of $618 billion in July. Gold offers an alternative reserve asset that is not another country's liability, despite its price volatility.
Chinese households are also turning to gold as other investment options lose appeal. A prolonged property market slump has weakened real estate as a store of wealth, while the CSI 300 stock market benchmark is down about 8% this year. China's one-year government bond yield stands at around 1.2%, compared to 4.46% in the US. Aakash Doshi of State Street Investment Management pointed to record consumer imports and rising domestic gold premiums as indicators of stronger seasonal demand in China this winter.
Gold purchases by Chinese central banks and consumers have helped support prices, even as US bond yields remain high and markets anticipate further Federal Reserve tightening. Ewa Manthey of ING Bank noted that Chinese buying has become a structural pillar of support for gold prices. However, gold has also seen sharp corrections, falling more than 8% in September to around $4,176 an ounce after touching a record above $5,500 in January. Doshi expects gold to trade between $4,750 and $5,500 per troy ounce by the end of the first quarter of 2027.