China’s gold-buying hiatus extends to 6m

China’s central bank maintained its gold reserves at 72.8 million troy ounces in October, marking the sixth consecutive month without additional purchases.

While the quantity remained unchanged, the value of these reserves increased to $199.06 billion from $191.47 billion in September, driven by the significant surge in bullion prices this year.

Gold prices have rallied approximately 33 per cent in 2024, poised for their largest annual gain since 1979. This surge is attributed to factors such as the US Federal Reserve’s interest rate cut cycle and geopolitical tensions.

The World Gold Council (WGC) anticipates a deceleration in global central bank gold purchases in 2024, although the levels are expected to remain above pre-2022 figures. This projection is partially influenced by the People’s Bank of China (PBC) pause in its 18-month buying streak since May.

The share of gold in the PBC’s overall reserves climbed to 5.7 per cent at the end of October, up from 4.9 per cent in April. This increase underscores the growing significance of gold in China’s foreign exchange reserves.

Attribution: Reuters

Subediting: Y.Yasser

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