China, known as the leading gold producer and buyer, isn’t only mining gold but bagging it at a rate like never before. For 17 consecutive months, China’s central bank has been buying the precious metal — aiming to shift its reserves away from the US dollar despite the associated high costs and a weakening yuan. It’s the country’s longest gold-buying run (ever) and an important ingredient in the commodity’s rally to record highs this year.

• Over the past two years, China has imported over 2.8K tons of gold — experiencing a 34% increase in imports in the first quarter of this year compared to last year.
• Investments in Chinese gold exchange-traded funds have consistently risen since June — totaling $1.3B this year, contrasting with $4B in outflows.

Gold rush: The price of gold has soared to over $2.4K per ounce, but in China, demand has gold buyers paying premiums over international prices as high as $89 per ounce — up from the historical average of $7. This sustained premium indicates strong and persistent demand for gold in the country. Precious Metals Insights’ Philip Klapwijk suggests that there is “still room for demand to grow,” with the current buying trend showing no signs of slowing anytime soon.