China’s gold reserves have increased for the 21st consecutive month in July as the country’s central bank continued to add to its holdings. This move coincided with a dip in international gold prices, according to recent data.
The central bank’s gold holdings grew by approximately 640,000 ounces in July, reaching a total of 76.08 million ounces as of the end of the month, based on information from the Foreign Exchange Authority.
The increase in gold purchases was mainly driven by a temporary correction in global gold prices, explained Wang Qing, a leading macroeconomic analyst at Golden Credit Rating International. In June, international gold prices fell sharply after the U.S. Federal Reserve signaled a more hawkish stance than expected at its policy meeting. Although prices stabilized to end July, the average price in July was 4 percent lower compared to June. This likely prompted the central bank to accelerate its gold-buying during that period, Wang noted.
Over the long term, significant shifts in the global political and economic scene are the primary factors influencing China’s continued accumulation of gold reserves.
By the end of 2025, gold constituted roughly 8.8 percent of China’s international reserves, which mainly consist of foreign exchange and gold assets. Globally, gold made up about 27 percent of central banks’ total reserve holdings by the end of 2025, an increase from 20 percent a year earlier, according to data from the European Central Bank released on June 2.
Wang highlighted that China’s percentage of gold within its official reserves remains comparatively low, leaving considerable room for further buildup. Since gold is widely recognized as a premier form of payment worldwide, increasing reserves could bolster confidence in the Chinese currency and support the internationalization efforts of the yuan.
“Despite gold prices approaching historic highs, the need to enhance gold reserves persists from the perspective of reserve structure optimization,” Wang added.
Across the globe, central banks continue to exhibit high demand for gold. The 2026 Central Bank Gold Reserves Survey by the World Gold Council revealed that 45 percent of surveyed central banks plan to grow their gold holdings within the next year, underscoring gold’s crucial role in maintaining the stability of official reserves over the long term.
Reserves Expansion
As of the end of July, China’s foreign exchange reserves stood at $3.42 trillion, a rise of $2.5 billion from June’s figure, maintaining a level above $3.4 trillion for four straight months, according to SAFE data published on August 7.
SAFE attributed the growth to a combination of exchange-rate fluctuations and asset price changes. In July, the US dollar index declined amid shifts in global macroeconomic conditions and monetary policies of major economies, with asset prices globally moving in different directions.
The weakening of the US dollar index in July significantly impacted China’s foreign exchange reserves by increasing the valuation of non-US dollar assets, slightly offsetting the overall decline in global financial asset prices, Wang explained.
The US dollar index dropped by 1.3 percent between the end of June and July’s close, according to Guan Tao, chief economist at BOC International. This depreciation boosted the value of China’s assets in foreign currencies other than the dollar, helping to increase total reserves.
Looking forward, exports—an essential element of China’s international payments—are expected to remain robust. The global manufacturing sector, driven by investment in artificial intelligence, continues to grow, supporting increased exports of semiconductors both in volume and value. Additionally, Chinese foreign trade companies are actively entering diverse markets, providing additional growth avenues, Wen Bin, chief economist at China Minsheng Bank, noted.