There is no denying that the current macroeconomic backdrop is fueling a ‘perfect storm’ for gold, reinforcing expectations that prices are now firmly on track to reach new all-time highs.
A scenario that could become reality at the end of this month, if not sooner.
China resumes gold purchases, setting the stage for a potential increase in precious metal reserves
In a statement released earlier this week, the People’s Bank of China said it had increased its gold reserves by 5 tonnes to 2,269 tonnes in November – marking the first new purchase since April.
According to data tracked by GSC Commodity Intelligence – the PBOC was the world’s largest official buyer of gold in 2023 – and played a crucial role in launching the precious metal into a furious bull run that saw prices continually soar. record highs – not once, not twice, but 39 times so far this year.
Even with the six-month break, the PBOC has bought more than 34 tons of gold this year to maintain its position as the world’s largest gold buyer in 2024. However, despite the increase, gold still represents only 6% of total Chinese precious metal reserves. .
But here’s where things really start to get interesting. A growing consensus among Wall Street’s most powerful institutions believes that China plans to increase its gold holdings by an estimated 15%, if not 20%, of its total gold reserves by 2028.