On July 17, the People's Bank of China (PBOC) announced that it had increased its gold holdings by 600 tonnes. The last time it had announced its reserves was in 2009. This meant that, over the past six years, the bank, on average, had been buying about 100 tonnes of gold a year, making them the largest gold buyer on the planet.
Now, like other central banks, PBOC is announcing changes in its gold position on a monthly basis. And, indeed, it added 19 tonnes to its holdings in July, 16 tonnes in August, and a further 15 tonnes in September. And, while the announcement of a 600-tonne increase over the last six years may have been a disappointment, the possible purchase of a couple hundred tonnes annually makes China a huge buyer in the market.
China’s Gold Reserves: 30 June – 30 September 2015 (Tonnes)
Source: Bloomberg
About the Author:
Joe Foster has been Portfolio Manager for the Van Eck International Investors Gold Fund since 1998 and the Van Eck – Global Gold UCITS Fund since 2012. Mr. Foster, an acknowledged authority on gold, has over 10 years of dedicated experience in geology and mining including as a gold geologist in Nevada. He has appeared in The Wall Street Journal, Barron's, and on Reuters, CNBC and Bloomberg TV. Mr. Foster has also published articles in a number of mining journals, including Mining Engineering and Geological Society of Nevada.
The article above is an opinion of the author and does not necessarily reflect the opinion of MV Index Solutions or its affiliates.