China may be purchasing gold at ten times its reported levels, lifting reserves above 5,000 tons and becoming a major driver of the global gold rally.

1. China’s Actual Gold Purchases May Be Ten Times Higher Than Official Figures

A recent investigative report by El Pais is sending ripples across global financial markets, suggesting that China’s gold purchases in 2025 could be ten times higher than the 25 tons officially disclosed by the People’s Bank of China (PBoC). If true, China may have quietly accumulated around 250 tons of gold, pushing its real reserves above 5,000 tons.

Such a massive discrepancy raises critical questions about China’s long-term financial strategy and the true scale of its influence on the global gold market.

2. Gold Hits New Highs as China Quietly Boosts Demand

According to El Pais, China appears to be a decisive, albeit silent, factor behind this year’s explosive rise in gold prices. While Beijing has not announced any large-scale gold acquisitions, independent data on imports, domestic consumption and reserve discrepancies indicate that the country may be purchasing gold far beyond its official declarations.

Journalists Inma Bonet and Guillermo Abril note that the remarkable surge in gold prices throughout 2025 cannot be fully explained by normal macroeconomic trends. Instead, they argue that China’s ongoing, unobtrusive accumulation of gold has created a steady and powerful level of demand that continues to support prices even during market volatility.

Gold prices have risen more than 50% since the beginning of the year, reaching nearly $4,143 per ounce on November 25 after a sharp overnight jump in New York, and previously touching an all-time high of $4,380 per ounce in October.

3. Fed Rate-Cut Expectations Add Further Momentum

Although China’s demand provides long-term structural support, expectations surrounding U.S. Federal Reserve policy have intensified the current rally. Markets are rapidly pricing in a rate cut at the December 10 meeting, especially following comments from New York Fed President John Williams, who noted that lower interest rates could come “in the near term.”

As a result, the probability of a December rate cut surged from about 20% to over 80% within days. With interest-bearing assets becoming less attractive, capital is flowing back into safe-haven instruments — gold being the most prominent.

Still, analysts emphasize that the Fed’s impact, while significant, is merely accelerating a trend that China’s sustained demand has already set in motion.

4. Why China Is Accelerating Its Gold Accumulation

Behind China’s large-scale, discreet accumulation of gold lies a combination of geopolitical anxiety, financial caution, and strategic realignment. The freezing of Russia’s overseas assets — including gold and U.S. dollar reserves — following the conflict in Ukraine highlighted how vulnerable national reserves can be when held within the Western financial system.

For China, this event served as a powerful warning. In an increasingly polarized world, reliance on the U.S. dollar is no longer seen as fully secure. Gold, by contrast, is politically neutral, globally accepted, and immune to foreign sanctions.

Michael Haigh of Société Générale explains that China’s gold strategy intensified shortly after the Russia–Ukraine conflict escalated, and recent developments in U.S. politics have only pushed Beijing to accelerate its diversification efforts.

Hoarding gold, he argues, remains one of the most effective ways for a country to safeguard its monetary foundation.

5. China’s Real Reserves Could Already Exceed 5,000 Tons

Official PBoC data lists China’s gold reserves at 2,304 tons, representing about 8% of its total foreign exchange holdings and ranking sixth globally. However, many industry experts believe this number significantly understates the truth.

Bruce Ikemizu, Director of the Japan Bullion Market Association (JBMA), estimates that China’s actual reserves may now exceed 5,000 tons, based on import data, market flows, and observed purchasing patterns. If accurate, this would place China much closer to the United States — currently holding about 8,133 tons — and transform China into the most influential player in the global gold market.

6. Independent Analysis Reinforces Concerns About Underreported Purchases

Société Générale conducted a detailed analysis using gold export data from the United Kingdom, which plays a central role in global bullion flows. When comparing this data with China’s domestic production and the official reserve figures, the bank identified substantial disparities indicating that China’s true purchases likely reached 250 tons, far above the reported 25 tons.

The analysis also shows that China has accumulated more than 1,080 tons of gold since mid-2022, averaging around 33 tons per month. Rather than sudden, market-shaking purchases, this represents a slow, deliberate strategy designed to avoid disrupting global prices.

According to El Pais, this consistent and controlled approach allows China to build long-term reserve strength without attracting too much attention from global markets.

7. A Global Shift: Other Countries Also Increase Gold Reserves

China is not acting in isolation. A growing number of countries are moving to expand their gold reserves amid rising geopolitical uncertainty. Russia, for example, has reportedly used gold as payment for drone shipments from Iran. India, Poland and several nations across Asia and Europe are also accelerating their gold purchases as a hedge against economic instability and potential sanctions.

Adrian Ash of BullionVault notes that the world is transitioning into a new geopolitical era characterized by heightened mistrust and strategic diversification. In this environment, gold is regaining its historical role as the ultimate safe-haven asset — not just for investors, but for governments.

8. How High Can Gold Go? Analysts Expect the Rally to Continue

Société Générale believes that the current surge in gold prices is not a speculative bubble but the beginning of a long-term structural shift. If China continues purchasing at its current pace and the Federal Reserve enters a rate-cutting cycle, gold could climb beyond $5,000 per ounce in the coming years.

The combination of central bank accumulation, geopolitical tension, and weakening confidence in traditional reserve assets has created a powerful foundation for continued growth in gold prices.

Many analysts agree that the bull market is far from over — and that China’s hidden purchases will remain one of the most important factors shaping the global gold outlook.

FAQs

1. Why is China buying so much gold?

China is seeking to reduce its reliance on the U.S. dollar, protect national reserves from potential sanctions and strengthen the security of its monetary system.

2. How much gold does China truly hold?

Experts estimate China may already possess more than 5,000 tons, far above the officially reported figure.

3. How do China’s purchases influence global gold prices?

China’s sustained demand provides strong upward pressure on gold prices and contributes to long-term market stability.

4. Will gold prices continue to rise?

Analysts believe so, with some forecasting that gold could surpass $5,000 per ounce due to ongoing central bank buying, geopolitical risks and expected interest rate cuts.