Why is China Buying So Much Gold?

It’s the last call for cheap gold…

New York Yankee great Yogi Berra said it best: “It’s like déjà vu all over again.”

In this case, the vu that we’re deja’ing is China—yet again—packing on the golden pounds. Or rather golden tonnes.

For the fourth consecutive month, the People’s Republic has added an increasing amount of gold to its national reserves. In June, the number was 480,000 ounces, or about 14.9 tonnes. May was 9.95 tonnes. April and March were 8.1 and 5 tonnes, respectively.

China buying gold is nothing new. It’s sort of like saying Angel Reese missed another layup (that’s a WNBA basketball joke; but if you don’t know, Reese is notorious for missing gimme layups).

Interesting, though, that across 2025 China was just phoning it in when it came to gold buying. What started as 5 tonnes of gold purchases in January 2025 dwindled to not even a full ton by December.

And now… four consecutive months of big-ton purchases.

Is it a coincidence that China’s gold purchases slowed as gold prices raced higher, and have now raced higher as gold’s price has retreated?

In the immortal words of the Magic 8 Ball: “Reply hazy.”

What we can say with some confidence comes from Fudan University economist Shao Yu, who put it about as plainly as an economist ever does: Beijing treated the entire Q2 selloff — gold falling from well over $5,000 to about $4,000 an ounce — like a discount window.

Meaning China is following the Field Notes view of gold ownership: Build a permanent buffer against long-term structural dollar weakness and use big selloffs to strengthen your position.

I mean, the pattern isn’t hard to discern:

China put itself on the financial equivalent of a juice cleanse aimed specifically at shrinking the weight of its US Treasury holdings—down to $651 billion in the most recent Treasury Department data, an 18-year low, and roughly half of where they sat at the 2013 peak.

But as China sheds its dollar fat, it’s bulking up on gold.

At least 20 consecutive months of purchases now, though that’s very likely underselling reality —because we’ve seen this movie before.

China went dark on its gold numbers for three straight years—from 2019 into November 2022—before abruptly flipping the lights back on and resuming monthly reports. The two previous times China pulled the same stunt… one time eventually revealing 454 tonnes no one knew about, before next time revealing an additional 604 tonnes that the world didn’t know China owned.

So assuming that China is lowballing the gold that’s actually in the Chinese vault, is making a leap no more challenging than stepping over a crack in the sidewalk.

Ask the Magic 8 Ball if there’s another surprise baked into China’s gold holdings, and you’ll likely see, “Outlook good.”

Whatever the case, it’s hard not to see the message China is sending: Kmart is having a blue-light special sale on gold (for those old enough to remember that). And for a limited time over on Aisle 8 (lucky number in China) you can stock up on gold at a nearly 30% discount from its all-time high.

Act now before the light goes off! (Speaking of taking acting, I’m hosting a special summit later today, discussing a major policy shift I’m predicting out of Washington, come Nov. 3… Click here to tune in for free, and hear how I’m planning to act in the wake of the big changes I see coming our way…)

Because the light will go off and gold will resume its secular climb higher. Nothing has changed to alter that trend. The Chinese central bank is sending that message loud and clear.

That’s not China predicting the future.

That’s China simply refusing to pretend that the world’s current monetary system is permanent.

It’s not.

Structural changes have been taking shape globally for the last several years, and with every monthly purchase of gold, China is positioning for the change while retail and institutional investors are selling.

I’ve said it before, but it seems apropos once again: Someone in the trade is destined to be wrong.

I’m betting on the country that has thousands of years of planning three generations into the future.