China gold market update: Strong official sector buying in July
14 August, 2026
Highlights
- Gold prices stabilised in July: the LBMA Gold Price PM was unchanged and the Shanghai Benchmark Gold Price PM rose mildly by 0.7%; both broke higher in early August
- Chinese gold ETFs recorded positive flows, lifting total holdings 5t higher in July to 282t; this positive trend has continued so far in August, with inflows recorded almost every trading day1
- As the gold price volatility declined, gold futures’ trading volumes cooled but net longs rose in July
- Wholesale demand stayed tepid last month, reflecting ongoing weakness in the jewellery sector
- The People’s Bank of China (PBoC) reported an addition of 20t of gold during July, the largest since late 2023 and the 21st consecutive monthly purchase.
Looking ahead
- If the gold price continues to break higher investment demand for gold may improve. However, the domestic equity market rebound in early August – should it persist – could divert attention. Wholesale gold demand could receive seasonal support from a rise in jewellers’ inventory replenishment ahead.
Gold steady in July
Gold stabilised in July. The LBMA Gold Price PM in USD and SHAUPM in RMB were almost unchanged during the month. Our gold return attribution model shows that a weaker dollar and improved investor positioning supported gold, offsetting pressure from rising yields (Chart 1). And in early August, gold rose higher on softer US labour market data and cooling inflation, which delayed expectations of rate hikes from the Fed; the RMB gold price rallied above its 60-day moving average of around RMB920/gram for the first time since mid-March.2
Chart 1: Gold stabilised in July
Monthly returns of gold prices in USD and RMB*
*Data to 31 July 2026. Based on the LBMA Gold Price PM in USD and the Shanghai Benchmark Gold Price PM in RMB.
Source: Shanghai Gold Exchange, ICE Benchmark Administration, World Gold Council
Chinese gold ETF flows flipped positive
Chinese gold ETFs attracted inflows of RMB5bn (US$744mn) in July, reversing the sizeable outflows over previous months. Healthy inflows lifted Chinese gold ETFs’ total AUM by 3% to RMB 250bn (US$37bn). In tonnage terms, holdings increased 5t to 282t. In July, investor interest was buoyed by recurring geopolitical uncertainty, weaker equities and persistent gold accumulation by the PBoC. Meanwhile, rising institutional investor participation as the gold price stabilised also supported demand in the month.
Despite outflows in May and June, Chinese gold ETFs attracted RMB45bn (US$6.3bn, 34t) between January and July, the second strongest y-t-d performance on record (Chart 2), reflecting increased institutional participation and higher allocations amid various uncertainties.
And it is worth noting that so far in August, Chinese gold ETFs have added ~8t with inflows seen almost every day in the month, mainly supported by the strong gold price momentum.3
Chart 2: Strong y-t-d performance of Chinese gold ETFs
Chinese gold ETF demand and holdings in tonnes*
*Data to 31 July 2026.
Source: Company filings, World Gold Council
Gold futures volumes down, net longs up last month
Gold futures trading volumes on the SHFE further moderated in July, falling 4% m/m to 292t/day. Trading activity cooled slightly as gold price volatility declined. Top 20 gold futures participants’ net longs – due to data limitation – at the SHFE rose 24t to 117t by the end of July, reflecting improved market sentiment.
Wholesale demand stayed tepid last month
Wholesale gold demand, as measured by SGE withdrawals by banks, jewellers and refiners, fell 8% m/m to 80t in July (Chart 3). The decline was largely seasonal, as the jewellery sector is typically tepid in Q2 and early Q3. Industry feedback also suggests that investment demand was broadly unchanged from June and therefore failed to offset softer jewellery-related buying. On a y/y basis, SGE withdrawals were down 15%, reflecting subdued jewellery consumption amid higher gold prices than a year ago and still-weak consumer confidence.
Chart 3: Wholesale demand remains tepid in July
Gold withdrawals from the SGE by month and the ten-year monthly average*
*As of 31 July 2026. Ten-year average based on data between 2016 and 2025.
Source: Shanghai Gold Exchange, World Gold Council
The PBoC added more gold in July
The PBoC reported a 20t increase in gold reserves in July (Chart 4), bringing official gold holdings to 2,366t, 8% of total foreign exchange reserves. Following the largest monthly addition since October 2023, the PBoC’s gold-buying streak has now reached 21 months, the longest on record. The central bank continued to accelerate its buying, likely taking advantages of a lower gold price and underscoring gold’s strategic role in reserve diversification amid an increasingly fragmented geopolitical landscape.
Chart 4: The PBoC ramped up gold purchasing efforts as the price softened
The PBoC’s reported gold purchases and the gold price*
*Data to 31 July 2026.
Source: State Administration of Foreign Exchanges, World Gold Council
Imports elevated in June
China’s net gold imports totalled 152t in June (Chart 5) according to the latest available data, a mild 2t m/m rise, but the highest since March 2024. Over the course of H1 China imported 764t of gold, 138% higher y/y, reflecting strong investment buying during the period.
Chart 5: Gold imports were higher in June
Net gold imports under HS7108*
*Data to June 2026.
Source: China Customs, World Gold Council
Footnotes
1Based on daily flows data as of 12 August; Chinese gold ETFs recorded non-stop inflows every day during the period except for 12 August.
2Based on the daily close prices of Au99.99 as of 12 August. For more, see: Gold Spot Prices & Market History | World Gold Council.
3Based on Chinese gold ETF demand as of 12 August. For more, see: Gold ETF: Stock, Holdings and Flows | World Gold Council.
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