The central bank takes action! Buying nearly 100 billion yuan of gold [with gold market analysis]

Gold is a limited resource with scarcity and value retention ability. It can be used as an investment tool to maintain and increase value. The price of gold will be affected by market supply and demand, economic situation, geopolitics and other factors. Potential capital gains can be obtained by purchasing gold.

The latest data shows that by the end of August 2023, the scale of China's foreign exchange reserves is US $3160.1 billion, with a month on month decrease of 1.38%. At the same time, gold reserves reached 69.62 million ounces at the end of August, an increase of 930000 ounces month on month.

It is worth noting that the central bank has increased its holdings of gold for 10 consecutive months since it increased its holdings in November last year. If calculated by the average price of the range, the cumulative total increase in holdings is about 97.6 billion yuan.

(Data picture)

Dr. Zhao Qingming, chief strategy officer of Yaoben Private Equity Fund and an international financial expert, said: "As for the increase of gold reserves, it has been ten consecutive months. On the one hand, at present, the proportion of China's gold reserves in official reserves is still very low. In the context of the current volatile international environment and high risks, it is still meaningful to increase gold holdings from the perspective of asset allocation. On the other hand, from a relatively long-term perspective, increasing gold holdings is of strategic significance in promoting the internationalization of the RMB. "

Gold production resumed its growth trend

From 2018 to 2022, China's gold output will decline first and then increase. In 2022, China's raw gold output will be 372.048 tons, with a year-on-year growth of 13.1%, of which gold mineral gold will increase by 14.5%; In the first half of 2023, the production of gold enterprises across the country will return to normal, all major mines will resume production, and the output of raw gold will keep growing, with a year-on-year increase of 2.24%.

Demand for precious metal materials will decline in 2022

In 2023, the economy and society will return to normal operation in an all-round way, the national economy will recover and improve, and the national gold consumption will recover rapidly in general; In the first half of 2023, the national gold consumption will be 554.88 tons, with a year-on-year growth of 16.37%, mainly driven by the growth of gold jewelry, gold bars and gold coins. The consumption of industrial and other gold will decline by 7.65% year on year.

The State Administration of Foreign Exchange said that in August 2023, influenced by macroeconomic data of major economies, monetary policy expectations and other factors, the US dollar index rose and global financial asset prices fell as a whole. Exchange rate translation, asset price changes and other factors combined to reduce the scale of foreign exchange reserves in the month. China's economy has maintained a trend of recovery and improvement, with strong economic resilience, great potential and sufficient vitality. The fundamentals of long-term improvement have not changed, which is conducive to the continued stability of the scale of foreign exchange reserves.

Prospective Economist APP Information Group

For more research and analysis on this industry, please refer to the Analysis Report on Market Segmentation Demand and Investment and Operation Strategies of China's Gold Industry from 2023 to 2028 issued by the Prospective Industry Research Institute

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