FT: Why Is China Buying Up Gold At A Record Pace?

The country imported more than 1,000 metric tons over the course of eight months.

China has sharply increased its gold purchases this year. In the first eight months, the country imported more than 1,000 metric tons of the precious metal, spending a record $158.8 billion on it. This is reported by the Financial Times.

By comparison, China imported 886 metric tons of gold worth $96.5 billion in all of 2025.

The main reason for this demand is the desire of the government and private investors to protect their savings amid geopolitical instability and weak returns on other assets.

Chinese holdings of U.S. Treasury bonds fell to $618 billion in July, the lowest level since August 2008. At the same time, attractive investment opportunities within the country have dwindled. The real estate market crisis has persisted since 2021, and the CSI 300 Index has lost 1.8% since the start of the year and is more than a fifth below its peak levels from early 2021. Yields on Chinese government bonds have also approached historic lows.

“Both the central bank and private investors are diversifying their reserves and savings toward an asset that carries no counterparty risk,” said Lisa Liu, managing director of Gold Mountains Asset Management .

Chinese demand for gold reflects not a short-term trend but a more sweeping restructuring of asset allocation. “This is a long-term restructuring of the asset allocation of households and the government,” Liu said.

At the same time, the actual volume of purchases by the People’s Bank of China may exceed official figures. Goldman Sachs estimates the central bank’s July purchases at 35 metric tons, compared to the reported 20 metric tons.

China itself is the world’s largest gold producer, but domestic production is clearly insufficient to meet current demand. Last year, the country produced 384 metric tons of gold.

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