PBoC Buys Gold Again, But Fed Sentiment Remains Pressured on Prices
China's central bank again added to its gold reserves in April, confirming that sovereign demand remains strong amid global market volatility. The latest data from the World Gold Council (WGC) shows that the People's Bank of China (PBoC) purchased 8 tons of gold in April—the largest since December 2024—extending its record run of purchases to 18 consecutive months.
With this addition, the PBoC's gold holdings reached 2,322 tons, approximately 9% of China's total foreign exchange reserves. That same month, the PBoC became the third-largest buyer among global central banks, behind only Poland and Uzbekistan, according to the WGC.
Globally, central bank net purchases increased again in April after a brief period of net selling in March. At that time, the direct economic impact of the Iran war prompted several developing countries to sell gold to maintain currency stability.
Central bank buying has been a major driver of the gold rally, which is said to nearly double its price throughout 2025. The World Gold Committee (WGC) also noted an acceleration in buying since 2022, when the issue of foreign exchange reserve security resurfaced following Russia's freezing of foreign assets following its invasion of Ukraine.
However, fundamental support from central banks has not been enough to stem the recent decline in gold prices. After hitting a record high of around US$5,600/oz in January, gold is said to have fallen by around 23% and is now trading around US$4,300/oz, pressured by strong US employment data and rising expectations of a Fed rate hike. Because gold does not provide a yield, some investors have shifted to interest-bearing assets such as bonds, increasing pressure on bullion. (arl)
Source: Newsmaker.id
