China imported more than 1,000 tonnes of gold between January and August 2026, worth a record $158.8 billion, according to customs data cited by CNBC. The total already exceeds the 886 tonnes imported in the whole of 2025, valued at $96.5 billion.
The People’s Bank of China (PBOC) bought about 23 tonnes of gold in September, its biggest monthly purchase in nearly three years, according to data cited by CNBC. The purchase marked the central bank’s 23rd consecutive month of buying.
The surge comes as Indian consumers prepare for Dhanteras and Diwali next month, when gold purchases traditionally rise.
Why China is buying so much gold
China’s gold buying is partly driven by its efforts to reduce dependence on the US dollar, according to Carsten Menke, an analyst at Julius Baer Group, quoted by CNBC.
The freezing of Russia’s central bank assets by Western governments following Moscow’s 2022 invasion of Ukraine highlighted the risks of keeping national reserves in assets held abroad.
China has also reduced its holdings of US government debt. Its holdings of US Treasuries fell to an 18-year low of $618 billion in July, according to data cited by CNBC.
Gold offers central banks an alternative reserve asset that is not another country’s liability, although its price can fluctuate sharply.
Chinese households turn to gold for safety
China’s households are also buying more gold as other investment options lose their appeal.
A prolonged property market slump has weakened the appeal of real estate as a store of wealth. Meanwhile, the CSI 300 stock market benchmark is down about 8% this year, and China’s one-year government bond yield is around 1.2%, compared with 4.46% in the US, CNBC reported.
Aakash Doshi of State Street Investment Management told CNBC that record consumer imports and rising domestic gold premiums point to stronger seasonal demand in China this winter.
How China’s buying is supporting gold prices
Gold purchases by Chinese central banks and consumers have helped support prices even as US bond yields remain high and markets anticipate further Federal Reserve tightening.
Ewa Manthey of ING Bank told CNBC that Chinese buying has become a structural pillar of support for gold prices.
However, gold has also seen sharp corrections. Prices fell more than 8% in September to around $4,176 an ounce, after touching a record above $5,500 in January.
Doshi expects gold to trade between $4,750 and $5,500 per troy ounce by the end of the first quarter of 2027.
The World Gold Council’s July outlook showed that global gold demand, including over-the-counter investment, was flat at 1,269 tonnes in the second quarter. Demand in the first half rose 2% to 2,522 tonnes, worth a record $380 billion.
Central banks bought 289 tonnes during the second quarter, while gold-backed exchange-traded funds (ETFs) recorded outflows of 45 tonnes. Jewellery demand fell to 278 tonnes, its lowest quarterly volume since the pandemic, as high prices made purchases less affordable.
What China’s gold buying means for India
Indian gold prices are influenced by international rates, currency movements and domestic factors. Sustained Chinese buying could therefore help support prices in India as the festive season approaches, although it does not guarantee that prices will rise.
MCX gold futures for December 4 delivery were down 0.46% at ₹1,50,800 per 10 grams at 9.03 am on Monday, October 12. Silver futures were flat at ₹2,25,509 per kilogram.
In the spot market, gold closed at ₹1,48,909 per 10 grams on Friday, October 9, while silver settled at ₹2,21,191 per kilogram.
Festive demand could provide additional support to Indian gold purchases, but prices will remain sensitive to central bank buying, investment flows and expectations for US interest rates.
US consumer price index (CPI) data due this week could offer fresh clues about the Federal Reserve’s next policy moves, making inflation and interest rate expectations key factors for gold prices in the days ahead.