China is buying record amounts of gold to reduce its reliance on the US dollar and hedge against potential geopolitical risks.
China continues to buy large amounts of gold. The nation wants to lower its reliance on US dollar assets. Officials hope this strategy protects the country from geopolitical and financial risks. Meanwhile, Chinese households are also buying gold to protect their personal savings.
The People’s Bank of China recently bought gold for 23 months in a row. September saw the largest monthly purchase in nearly three years. Experts view this as a long-term plan to spread out risks. The bank now holds about 2,410 tonnes of the metal.
Also, gold now makes up 8.5 percent of China's official reserves. This is a big jump from 5.5 percent at the end of 2024. These reserves help central banks manage international payments. They also provide a buffer during times of economic trouble.
Next, experts point to concerns over high US debt levels. Western nations previously froze Russian assets after the invasion of Ukraine. This event showed the risks of holding money in foreign countries. China prefers to store its gold at home.
Then, domestic gold storage offers a unique safety advantage. It does not depend on the actions of other governments. This gold is not a claim on another nation. Therefore, it is harder for foreign powers to freeze or sanction.
Moreover, private citizens in China are buying more gold coins and bars. Sales grew by over 28 percent in early 2026. Many people feel uncertain about the local property market. They see gold as a safer way to store their wealth.
However, the US dollar remains the world's primary reserve currency. Analysts say China is not abandoning the dollar quickly. This shift is a slow process of diversification rather than a sudden change. China still needs dollars for international trade.
Finally, other nations are also adding to their gold stockpiles. Central banks in emerging markets show a similar trend. Still, China's total gold reserves remain much smaller than the massive stockpile held by the United States.