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Gold prices suffered a sharp technical breakdown in June, slicing through the $4,000-an-ounce mark as bullish momentum faded. Yet against the rout, China is doubling down on the precious metal: its central bank has ramped up reserve purchases to the fastest pace this year, while Hong Kong has launched a trial of a centralized gold clearing system to reinforce its standing as a global trading hub.
Spot gold slumped below its 200-day moving average near $4,500 an ounce last month before the selloff pushed prices under $4,000, cooling speculative buying across global markets. The pullback, however, has opened a window for official-sector investors, who have emerged as the most reliable backstop for bullion this year.
The People’s Bank of China added 15 tonnes of gold to its reserves in June, its largest monthly purchase so far in 2026, according to updated official data. The increase extends the PBOC’s unbroken buying streak to 20 consecutive months, lifting total official holdings to 2,346 tonnes. Year-to-date, the central bank has accumulated just over 40 tonnes, with its purchase pace accelerating as prices retreated — a clear pattern of tactical dip-buying.
China is not the only official buyer stepping in. The Central Bank of Uzbekistan added 9 tonnes in June, bringing its year-to-date net purchases to 41 tonnes, the second-highest among economies that have released data, World Gold Council senior EMEA analyst Krishan Gopaul noted in a social media post. Poland’s National Bank remains the top official buyer for 2026, having boosted reserves by 64 tonnes through May, ahead of its June disclosure.
“Central banks certainly will be buying and probably buying more now that price has eased,” said Nitesh Shah, head of commodities and macroeconomic research at WisdomTree, in a recent interview with Kitco News.
Official-sector demand has been volatile in recent months. Some nations were forced to monetize gold holdings to shore up their currencies amid a global energy crisis triggered by geopolitical conflict. But analysts say the worst of the disruption has passed, and they expect official buying to reaccelerate in the second half, driven by the long-term structural shift away from dollar-denominated assets.
Parallel to the reserve buildup, Hong Kong is moving to upgrade its gold market infrastructure. The city’s Financial Services and the Treasury Bureau announced the start of trial operations for a new central gold clearing and settlement system, operated by the fully government-owned Hong Kong Precious Metals Central Clearing Company Limited.
The platform delivers standardized clearing and settlement services for bilateral and over-the-counter gold transactions. The first batch of bullion has already been deposited into designated vaults, and the first round of trading and settlement has been completed, with strong participation from banks, mining firms, refiners, jewelers and institutional investors.
The clearing system is the cornerstone of a broader policy push to build a full-chain gold trading ecosystem in Hong Kong, in line with explicit support under China’s 15th Five-Year Plan for the city to develop its commodity trading landscape.
Supporting measures include the launch of the initial phase of a Delivery Connect scheme with the Shanghai Gold Exchange, a new HAU price ticker, expanded storage and refining capacity, a wider range of investment and risk management products, tax incentives, greater flexibility for Mandatory Provident Fund allocations to gold ETFs, and the formation of an industry-led trade association.
“The commencement of the trial operation marks a significant step forward in developing Hong Kong’s gold trading infrastructure,” Financial Secretary Paul Chan said. “Along with a series of measures to deepen connectivity with the mainland gold market, we are committed to building a thriving ecosystem that will enhance the depth and breadth of our financial markets and consolidate Hong Kong’s status as a leading international precious metals hub.”
For the broader gold market, analysts widely view the $4,000-an-ounce level as forming a durable floor, with persistent central bank demand acting as the core support.
Jerry Prior, chief operating officer and senior portfolio manager at KraneShares, said the fundamental drivers behind official gold accumulation remain unchanged. “There’s a long-term de-dollarization theme that is structural, and I think it’ll be persistent,” Prior told Kitco News. As energy exporters and other commodity producers see income flows recover, “we don’t see that capital going into the Treasury market. We see it going back into the gold market.”
