China’s central bank extended its gold buying streak to 21 months, adding 20 tons in July and pushing the total accumulation toward a two‑year mark as bullion prices built support above $4,000 an ounce.

The central bank’s purchases come amid a backdrop of geopolitical tension, with signs of progress on US‑China trade talks reducing demand for safe‑haven assets while military hostilities between India and Pakistan escalated, adding uncertainty to the market.

Gold fell, snapping a two‑day advance, as progress on US‑China trade talks curbed demand for havens even as military hostilities between India and Pakistan escalated. A photograph taken at the Italpreziosi Sp A precious metals refinery in Arezzo, Italy, on Tuesday, May 6, 2025, shows gold bars arranged for the camera, captured by photographer Alessia Pierdomenico for Bloomberg.

The extended buying streak signals China’s intent to diversify its holdings and hedge against potential currency fluctuations, a move that aligns with broader global trends of central banks increasing gold exposure. The recent price surge above $4,000 has attracted attention from investors worldwide. The move underscores China's strategy to diversify reserves amid rising geopolitical risks. Analysts say the prolonged buying could stabilize gold prices and reinforce China's financial resilience. This development reflects growing confidence in gold as a hedge against economic uncertainty.