Gold Price Tumbles as China's Gold Buying Spree Continues

The gold price is experiencing some selling pressure to start the week, falling about 1% and dipping below $4,400 per ounce on Monday.

This comes despite China's central bank adding 650,000 ounces of gold to its reserves in August, the largest monthly increase since October 2023. This purchase brings China's official gold holdings to around 2,366 tonnes, representing roughly 8% of its reserves.

The World Gold Council reported that China accumulated around 60 tonnes during the first seven months of this year, second only to Poland among reported central-bank buyers. The People's Bank of China has been steadily increasing its gold purchases over the past few months, moving from roughly 5 tonnes in early 2026 to approximately 20 tonnes in July and August.

Despite these bullish signs for gold demand, the metal is experiencing some short-term macro headwinds. Stronger U.S. employment data has increased expectations that the Federal Reserve could keep monetary policy restrictive or potentially raise rates again, which generally creates a headwind for gold as it doesn't generate interest income.