China has reportedly acquired an estimated 88 tonnes of gold through the over-the-counter (OTC) market during May and June, raising the country's total gold reserves to a record 2,366 tonnes.

The purchase, detailed by Cointelegraph, underscores China's ongoing strategy of bolstering its gold holdings amid global economic uncertainty. The reported scale of the acquisition has drawn attention to its potential effect on gold prices, as it points to strong demand from one of the world's largest economies. Because OTC transactions are privately negotiated rather than exchange-traded, figures of this kind are typically analyst estimates rather than direct disclosures, one reason independent tallies of Chinese buying and officially reported reserve totals can diverge.

Gold forms part of the official reserve assets managed by the People's Bank of China (PBOC), the country's central bank. In recent years, the PBOC has repeatedly disclosed incremental additions to its gold holdings in its regular reserve updates — an 18-month streak of reported monthly increases paused in mid-2024 before disclosures of fresh purchases resumed later that year — placing China among the largest official holders of the metal, behind the United States, which reports roughly 8,100 tonnes, the world's largest official stockpile, as well as Germany, Italy, France, and Russia. Gold still accounts for a comparatively small share of China's official reserves, which remain dominated by foreign-currency assets. Central banks worldwide have likewise been persistent net buyers of gold in recent years, a trend documented in the World Gold Council's regular reporting on official-sector demand: net official purchases exceeded 1,000 tonnes in each of 2022, 2023, and 2024, roughly double the average pace of the preceding decade, a period of accelerated buying that followed the freezing of Russia's central bank reserves in 2022. World Gold Council surveys of central banks have repeatedly cited crisis hedging and diversification as leading motives for such purchases.

Prediction markets referenced alongside the report currently price a 73.7% probability of a YES outcome that gold will reach $4,700 in August. The report suggests that the unexpected scale of China's purchases could indicate a strategic effort to hedge against economic volatility.

What to Watch

Market observers will be watching how the development influences gold trading in the days ahead. The PBOC's monthly reserve disclosures, published early each month, will show whether any portion of the reported OTC purchases is formally recognized in official holdings. Key variables include potential shifts in U.S. Federal Reserve policy, which can affect dollar strength and Treasury yields and, in turn, gold prices. Any fresh central-bank buying headlines from the People's Bank of China, geopolitical tensions, and upcoming economic data releases are also expected to shape market expectations.