• 3 minutes e-car sales collapse
  • 6 minutes America Is Exceptional in Its Political Divide
  • 11 minutes Perovskites, a ‘dirt cheap’ alternative to silicon, just got a lot more efficient
  • 2 hours GREEN NEW DEAL = BLIZZARD OF LIES
  • 1 day Does Toyota Know Something That We Don’t?
  • 4 days OPINION: Putin’s Genocidal Myth A scholarly treatise on the thousands of years of Ukrainian history. RCW
  • 1 day World could get rid of Putin and Russia but nobody is bold enough
  • 9 hours America should go after China but it should be done in a wise way.
  • 4 days CHINA Economy IMPLODING - Fastest Price Fall in 14 Years & Stock Market Crashes to 5 Year Low
  • 3 days China is using Chinese Names of Cities on their Border with Russia.
  • 4 days Russian Officials Voice Concerns About Chinese-Funded Rail Line
  • 3 days CHINA Economy Disaster - Employee Shortages, Retirement Age, Birth Rate & Ageing Population
  • 4 days Putin and Xi Bet on the Global South
  • 4 days "(Another) Putin Critic 'Falls' Out Of Window, Dies"
  • 5 days United States LNG Exports Reach Third Place
  • 5 days Biden's $2 trillion Plan for Insfrastructure and Jobs
  • 9 days huge-deposit-of-natural-hydrogen-gas-detected-deep-in-albanian-mine

Breaking News:

Chicago Files Suit Against Big Oil

Four States Eye Tax Exemptions for Precious Metals

Four States Eye Tax Exemptions for Precious Metals

Four states, Georgia, Kentucky, Wisconsin,…

Central Banks' Appetite for Gold is Skyrocketing

Central Banks' Appetite for Gold is Skyrocketing

In 2023, global gold demand…

Why Oil Prices Rallied This Week

Why Oil Prices Rallied This Week

While the market navigates through…

ZeroHedge

ZeroHedge

The leading economics blog online covering financial issues, geopolitics and trading.

More Info

Premium Content

China’s Gold Buying Spree Continues For Seventh Consecutive Month

  • China has increased its gold reserves for a seventh consecutive month, with an addition of approximately 16 tons in May, bringing its total stockpile to around 2,092 tons.
  • Amid rising global inflation and geopolitical uncertainty, central banks worldwide set a record in gold purchases last year, and analysts expect the buying trend to persist.
  • While the end-May foreign currency reserves in China decreased slightly, the ongoing gold acquisition is predicted to bolster gold prices, which reached a record high in May.

In an unabated buying spree, China has continued to expand its gold reserves for a seventh consecutive month, reinforcing the sustained global demand for the precious metal among central banks.

As per Wednesday’s data from the People’s Bank of China, the nation’s gold holdings saw an approximately 16-ton increase in May.

This surge brings the total stockpile to roughly 2,092 tons, following an addition of 144 tons from November through the previous month.

In the wake of escalating geopolitical uncertainty and persistent global inflation, central banks worldwide set a record in gold purchases last year. Despite experiencing a significant drop in the first quarter of this year, according to the World Gold Council, market analysts expect the strong buying trend to persist.

A recent council survey disclosed that around a quarter of global central banks plan to bolster their holdings over the forthcoming year. This comes amidst mounting skepticism regarding the future role of the US dollar.

Ruth Crowell, the Chief Executive Officer of the London Bullion Market Association, in an interview with Bloomberg TV, predicted that this robust demand from central banks is set to continue through the year.

The collective purchases of central banks accounted for nearly one-fourth of the global gold demand last year.

This ongoing procurement is expected to provide support to gold prices, which hit an all-time high in May. In the first quarter of the year, only Singapore outpaced China in terms of gold purchases.

China’s intensified gold acquisition, which commenced in November, is the first since a 10-month rally that concluded in September 2019. The previous significant inflow ended in late 2016 (though many question the official data, suggesting China's gold holdings are considerably larger).

In the meantime, the People’s Bank of China reported a decrease in the country’s end-May foreign currency reserves, which dropped from $3.20 trillion to $3.18 trillion compared to the preceding month.

ADVERTISEMENT

By Zerohedge.com

More Top Reads From Oilprice.com:


Download The Free Oilprice App Today

Back to homepage





Leave a comment
  • Mamdouh Salameh on June 10 2023 said:
    China’s gold holdings saw an approximately 16-ton increase in May bringing its total stockpile to around 2,092 tons.

    A recent council survey disclosed that around a quarter of global central banks plan to bolster their holdings over the forthcoming year. This comes amidst mounting skepticism regarding the future role of the US dollar.

    Other than augmenting its foreign reserves, why is China amassing so much gold? The answer is simply to support the petro-yuan in the battle with the petrodollar for dominance in the global oil trade.

    The petrodollar is backed by US treasury bills so it can help fuel US deficit spending. Contrast this with a petro-yuan convertible to gold. In effect, China is offering customers oil contracts payable either in petro-yuan or gold.

    It is inevitable that Saudi Arabia and other GCC countries will adopt the petro-yuan as a means of payment for their oil exports to China. This would reduce the petrodollar’s share in the global oil trade by 22%.

    And with China paying for its estimated 13.0 million barrels a day (mbd) of crude imports in petro-yuan, Russia selling its 8.0 mbd of exports in ruble and petro-yuan, Venezuela and Iran already accepting the petro-yuan and India paying in rupees for its 5.0 mbd of crude imports, the petrodollar will certainly lose an estimated 60% of its global oil trade.

    By undermining the petrodollar, China will also be undermining both the US financial system and the US economy. This could probably lead to a devaluation of the dollar by one third to one half of its current value.

    It is inevitable that that within the next decade the yuan will become the world’s main reserve currency with the petro-yuan dominating the global oil trade.

    Dr Mamdouh G Salameh
    International Oil Economist
    Global Energy Expert

Leave a comment




EXXON Mobil -0.35
Open57.81 Trading Vol.6.96M Previous Vol.241.7B
BUY 57.15
Sell 57.00
Oilprice - The No. 1 Source for Oil & Energy News