Central Banks Buying Gold: China Adds for a 23rd Month as Prices Dip

Central Banks Buying Gold: China Adds for a 23rd Month as Prices Dip

By Fazil Thaha, Faz Gold

Central banks are still buying gold, even while the price has slipped. China's central bank added 740,000 troy ounces of gold in September, its 23rd month in a row of buying, and the World Gold Council says central banks bought a net 39 tonnes in August. In this article I explain what that means for anyone in Singapore watching the gold price today, and why this quiet, steady buying matters more than one bad week.

What happened this week

On 7 October, the People's Bank of China (PBoC), China's central bank, reported that its gold reserves rose to 77.47 million troy ounces at the end of September. That was an increase of 740,000 ounces, up from 650,000 ounces added in August. September was the 23rd straight month in which the PBoC added to its gold.

A day earlier, on 6 October, the World Gold Council (WGC) published its latest central bank statistics. A "net" figure means purchases minus sales. Its data showed:

  • Central banks bought a net 39 tonnes of gold in August, bringing the total for 2026 so far to 170 tonnes.
  • Poland was the biggest buyer this year, with 98 tonnes added so far in 2026, including 8 tonnes in August. Its holdings reached 648 tonnes, close to its stated target of 700 tonnes.
  • China added 20 tonnes in August, by the WGC's count. Uzbekistan bought 8 tonnes, Kazakhstan 7 tonnes, Turkey 3 tonnes and the Czech Republic 2 tonnes, its 42nd month of buying in a row.
  • Not everyone bought. Russia sold 6 tonnes and Jordan sold 3 tonnes in August.

The WGC also pointed out that, looking back over 2016 to 2025, central bank buying has tended to be strongest in June and in September and October, although the pattern varies a lot from year to year.

Why is gold not rising if central banks are buying?

The short answer is that central banks are only one group of buyers, and this week other forces pushed the other way.

On 7 October, the US Federal Reserve released the minutes of its last meeting. The minutes showed most officials still expect another interest rate hike by the end of the year. Gold pays no interest, so when interest rates on US government bonds are high, some investors prefer bonds. The US 10-year Treasury yield, which is the interest rate on 10-year US government bonds, was trading around 5.3%, according to Kitco.

Spot gold, which is the price for immediate delivery in the global market, was near USD 4,110 per troy ounce in late US trading on 7 October, down about 1.3% that day, according to Kitco. Trading Economics described it as gold's lowest level since early August. By 9 October, gold had recovered a little, to around USD 4,145 per troy ounce, according to Trading Economics. Silver fell harder, to around USD 59.67 per troy ounce in late US trading on 7 October and about USD 58.83 in early US trading on 8 October, both according to Kitco.

So the picture is a tug of war. High interest rates pull gold down in the short term. Steady central bank buying gives it support underneath.

Why central bank buying matters

Central banks are not traders looking for a quick profit. They buy gold as part of long term plans to change what they hold in their reserves, which is the money and assets a country keeps to protect its currency and pay its bills abroad. The WGC described this year's buyers as familiar names following multi-year buying programmes.

Kenny Zhu, director of research at Sprott, told Kitco on 8 October that this trend began before 2022, but sped up after the sanctions on Russia that year, which showed how much power the US has over the dollar system. He said central banks are diversifying, meaning they hold less in US dollar assets and more in gold. He also said inflows into gold ETFs, which are funds that hold gold for investors, are still positive but smaller than during August's rally.

There is one more point worth noticing. China's monthly purchases have grown much larger this year, from 160,000 ounces in March to 740,000 ounces in September, according to PBoC figures reported by BigGo Finance. That happened while the gold price was pulling back from its earlier highs. A big buyer that keeps adding when prices dip is a source of steady demand, though it does not stop prices from falling in a given week.

What this means for Singapore buyers

Here is how I would think about this news if you buy, hold or sell gold or silver in Singapore. None of this is a prediction, and I do not know where prices will go next.

If you are thinking of buying

Central bank buying does not guarantee the price will rise soon. Interest rate news can move gold more in the short term. If you are waiting for a particular price, our free gold price alert for Singapore buyers will email you once when our live selling price reaches your target. If you want to see what your budget can buy right now, the What Can I Buy gold calculator shows which gold bars and silver bars in stock fit your budget.

If you are saving a little every month

Central banks buy slowly, month after month. Some individuals do something similar. Dollar Cost Averaging (DCA) simply means putting the same amount of money into gold every month, whether the price is high or low. Our Monthly Savings Plan calculator shows how that approach would have worked in the past. Past results do not guarantee future results.

If you are thinking of selling

Our buyback price is the price we pay you when you sell to us. Before you come in, you can check today's figures on our gold buyback rates page or use the sell gold calculator to see the live payout for your bars. You can also set a sell alert on the Gold Rate Alert page.

A note on prices: the figures in this article are global spot prices in US dollars per troy ounce. They are not what you pay or receive in Singapore. For local prices, please check the live SGD prices on fazgold.com.sg or ask at our counter. All of our free gold calculators are explained step by step in our guide to our free gold tools.

What to watch next

  • US September inflation data, due next week, according to Kitco. Higher inflation could keep rate hike talk alive.
  • The WGC's next central bank update, which should show whether September and October follow the usual pattern of stronger buying.
  • China's October reserve figures, normally released in early November.

For more background on why gold has held above USD 4,000 per troy ounce despite high bond yields, see our earlier article, Gold Price Outlook: Why Gold Is Holding Above USD 4,000 Despite 5% Bond Yields.

Visit Faz Gold

Our counter is at 10 Jalan Besar, #B1-19/20, Sim Lim Tower, Singapore 208787, open daily from 10.30am to 8pm. You can also WhatsApp us at +65 9767 7774 for live prices and stock.

Sources

This article is for general information and market commentary only and is not financial or investment advice.

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