Imagine you're in charge of currency intervention at the BOJ and this is what you have to show for. pic.twitter.com/feI5pAegdU
— Sven Henrich (@NorthmanTrader) September 7, 2023
China dumping its US Treasuries while converting Yellen Bux into gold doesn’t bode well for the dollar’s long run as the world’s reserve currency
Estimated Chinese Official Gold Reserves Cross 5,000 Tonnes
via Gainesville Coins:
My estimate for China’s official gold reserves reached 5,029 tonnes by the end of June 2023. In the first six months of 2023 the Chinese central bank bought an estimated 353 tonnes. Although demand in H1 2023 was down 34% from H2 2022, demand was still strong and a driving force of the price of gold.
One of the best kept secrets in the world of finance is how much gold is owned by the Chinese central bank, the People’s Bank of China (PBoC). In a previous article I have explained that growth in PBoC gold reserves can’t be gauged by tracking how much gold is mined or net imported in China, because this is virtually all sold through the Shanghai Gold Exchange to the private sector. The PBoC acquires gold abroad with US dollars and ships the metal to Beijing without leaving a trace in customs reports. There is but one way to find out how much the Chinese central bank is buying: through people in close contact with the banks and refineries that deal with the PBoC.
My starting point is an educated guess shared with me in 2015 by an industry insider that worked for one of the large precious metals consultancy firms. According to this source the PBoC roughly held 3,300 tonnes by then. Two other sources familiar with the matter, but prefer to stay anonymous, told me unreported central bank purchases—the difference between total estimated central bank purchases and reported purchases—can be used to evaluate the PBoC’s quarterly additions. Unreported purchases can mostly be accredited to the Chinese central bank, they told me.