China increases gold purchases, reducing dependency on the dollar
China continues to actively invest in gold in an effort to reduce the dollar’s share in its foreign exchange reserves. Analysts suggest that the scale of actual purchases may significantly exceed the official data.
According to the World Gold Council, from 2022 to 2024, central banks purchased over 1,000 tons of gold annually for their reserves. In 2023, total purchases already exceeded 600 tons. This year, China’s State Administration of Foreign Exchange officially acquired 25 tons of gold, although the real figure may reach 250 tons, according to Societe Generale, indicating a significant share of all global central bank purchases.
China’s strategy involves de-dollarization, which is also actively supported by other central banks worldwide. Over the last decade, the share of gold in reserves of countries, excluding the United States, has increased from 10% to 26%. Eoin Treacy from Fuller Treacy Money believes that this trend strengthened after the freezing of Russian foreign currency reserves, noting the importance of diversifying investments to avoid dollar dependency.
The region’s gold market is also integrating new technologies: in Shanghai, a jewelry recycling machine has already appeared, demonstrating an innovative approach to the consumption and processing of gold amid growing demand.
| Year | Official Purchases (tons) | Societe Generale Estimate (tons) |
|---|---|---|
| 2023 | 25 | 250 |
| 2022-2024 (annually) | 1000+ | – |
