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China’s central bank added 23 tons of gold to its reserves in June, marking an eighth consecutive increase.
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The country is stockpiling the safe-haven asset amid economic and geopolitical turmoil.
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The turn to gold also chips away at the US dollar’s dominance, a traditional reserve currency.
China’s central bank extended its gold-buying spree into an eighth consecutive month, adding 23 tons in June.
Now, the People’s Bank of China holds 2,330 tons of gold in its reserves, according to official data cited by Bloomberg.
The gold stockpiling comes amid the country’s bid to erode the dollar’s global dominance as well as growing economic and geopolitical uneasiness.
Meanwhile, other central banks around the world are buying up gold too. In 2022, demand for the yellow metal skyrocketed, and the trend has continued into this year with first-quarter purchases up 176% annually.
Though the greenback has been a long-standing reserve asset, the shift away from it follows Western sanctions on Russia for its invasion of Ukraine, effectively cutting off Moscow from $300 billion of its foreign-currency reserves.
According to a World Gold Council report from May, 62% of central banks estimate that gold will make up a greater share of reserves in the next five years. That’s while dollar reserves are forecast to ease, accounting for a 40%-50% share.
A separate survey by the Official Monetary and Financial Institutions Forum think tank recently showed that central bank reserve managers see a decrease in the dollar’s share to 53% over the next decade.
Last week, the International Monetary Fund said the dollar accounted for 59% of global reserves in the first quarter, up from 58.6% in the prior quarter.
Besides gold, China’s foreign currency reserves also rose by $16.4 billion from May. At June’s end, the central bank held $3.193 trillion.
Read the original article on Business Insider
