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China’s central bank added 23 tonnes of gold to its reserves in June, marking an eighth consecutive increase.
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The country is hoarding the safe-haven asset amid economic and geopolitical turbulence.
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The switch to gold also reduces the dominance of the US dollar, a traditional reserve currency.
China’s central bank extended its gold-buying spree for an eighth straight month, adding 23 tonnes in June.
The People’s Bank of China now holds 2,330 tonnes of gold in its reserves, according to official data cited by Bloomberg.
The gold stockpiling comes amid the country’s bid to erode the dollar’s global dominance as well as growing economic and geopolitical malaise.
Meanwhile, other central banks around the world are also buying gold. In 2022, demand for the yellow metal has skyrocketed, and the trend has continued this year with Q1 purchases up 176% annually.
Although the greenback has been a long-standing reserve asset, its abandonment follows Western sanctions against Russia for its invasion of Ukraine, cutting off Moscow by $300 billion of its foreign currency reserves.
According to a World Gold Council report from May, 62% of central banks believe that gold will make up a larger share of reserves over the next five years. It is then that the dollar reserves should decrease, representing a share of 40 to 50%.
A separate survey by the Official Forum of Monetary and Financial Institutions think tank recently showed that central bank reserve managers see a decline in the dollar’s share to 53% over the next decade.
Last week, the International Monetary Fund said the dollar accounted for 59% of global reserves in the first quarter, down from 58.6% in the previous quarter.
Besides gold, China’s foreign exchange reserves also increased by $16.4 billion from May. At the end of June, the central bank held $3.193 trillion.
Read the original article on Business Insider