China imported the most gold in two years

China Customs data last weekend showed that the country’s gold imports increased for the third consecutive month. In June, the country bought 173 tons of gold – the highest since March 2024. This data brings China’s gold imports in the first half of the year to a total of 820 tons, nearly double the same period last year, according to Business Today.

Cheaper gold prices and a stronger yuan increase investment demand. Gold has been under pressure since the Middle East war broke out at the end of February. Rising oil prices have pushed up inflation, raising concerns about global central banks raising interest rates. High interest rates will make precious metals less attractive, because they do not pay fixed interest. Since the beginning of March, world spot gold prices have decreased by more than 20%.

In addition, Chinese banks also take advantage of this opportunity to stockpile to meet retail demand. They are licensed by the Central Bank of China (PBOC) to import gold according to quotas. This process is very tightly controlled. Last month’s import level was likely also boosted by a new licensing mechanism effective from June 1, encouraging banks to use up their existing quotas.

To date, China’s gold imports have increased for 3 consecutive months. In April and May, these figures were 157 tons and 163 tons, respectively.

Ray Jia – Head of China market research at the World Gold Council (WGC) said: “The difference between gold prices in China and world prices continues to be an important factor driving import activities.” Jia forecasts that “the gold jewelry sector remains stable, as the industry replenishes inventories after a previous period of weak shopping demand.” China is currently one of the world’s largest gold consuming markets.

Also in June, PBOC announced that the country’s gold reserves increased the most in 2.5 years, with nearly 15 tons. PBOC has bought 20 consecutive months, bringing the country’s total gold reserves to 75.44 million ounces. However, falling gold prices caused the value of this reserve to only reach 303.7 billion USD at the end of last month, down from 340.7 billion USD in May.