Gold is getting so expensive that even China's central bank stopped buying the precious metal
Record gold prices are slowing appetite for the precious metal.VCG/Getty ImagesChina's central bank has paused gold buying after prices reached record highs.China's gold holdings were unchanged in May, halting an 18-month purchasing streak.Gold prices are up 11% this year due to geopolitical tensions, but have softened from a record high.China's central bank gold-buying streak has been a major driver of prices that hit record highs recently.However, it looks like gold has gotten so expensive that even the People's Bank of China is taking a break.On Friday, official data showed China's gold holdings were unchanged in May from the prior month — which means the central bank did not buy gold.The PBOC's pause has left gold "vulnerable to more downside pressure," wrote Ewa Manthey, a commodities strategist at ING Bank, on Monday.The benchmark spot gold price is around $2,300 per ounce — about 6% lower than its record high of nearly $2,450 per ounce on May 20.Prices of gold, a traditional safe-haven asset, have been on a tear this year, gaining about 11% this year-to-date due to global geopolitical tensions. In China, people are also loading up on gold as a store of value amid economic uncertainties and a weak Chinese yuan.But "gold's record-breaking rally might dent demand for now," wrote Manthey.China's central bank gold buying had actually started to slow in April, when it bought just 60,000 troy ounces of the precious metal. That was down from 160,000 ounces in March and 390,000 ounces in February.Before its pause in purchases last month, the PBOC had been snapping up gold for 18 straight months, making it the world's largest institutional buyer. According to industry association World Gold Council, China's central bank purchased 225 tons of gold in 2023. In second place was Poland's central bank, which bought 130 tons of the yellow metal.David Tait, the council's CEO, told Reuters on Monday that China is "just waiting and watching. If prices correct to the $2,200 per ounce level, they will resume again."Read the original article on Business Insider
Welcome to Billionaire Club Co LLC, your gateway to a brand-new social media experience! Sign up today and dive into over 10,000 fresh daily articles and videos curated just for your enjoyment. Enjoy the ad free experience, unlimited content interactions, and get that coveted blue check verification—all for just $1 a month!
Account Frozen
Your account is frozen. You can still view content but cannot interact with it.
Please go to your settings to update your account status.
Open Profile Settings