Goldman Sachs picks up on China's secret Gold reserve expansion

Goldman Sachs has picked up on the fact that China is expanding its gold reserves far faster than the official data indicates.

This probably comes as a surprise if you only follow mainstream financial news. Goldman is one of the few major financial actors to report on this phenomenon, but we've known about it for a long time. 

In a recent note, Goldman analysts estimated that China bought more than 48 tonnes of gold in May via the London over-the-counter (OTC) market. The People’s Bank of China only reported a 10-tonne increase to its gold reserves.

In other words, it appears the Chinese increased their gold reserves by 4.8 times the officially reported amount in May.

Based on official numbers, the Chinese central bank added 40 tonnes of gold to its holdings in 2026. This includes a 15-tonne increase in June, the largest official monthly purchase in over two years.

Goldman applied a more conservative 2.0 times multiplier and estimated the Chinese have accumulated closer to 80 tonnes of gold so far this year. If we use the 4.8 times multiplier extrapolated from the May data, Chinese gold reserves have grown by 192 tonnes.

Based on Goldman’s nowcast tool, China bought 67 tonnes of gold per month on a three-month seasonally adjusted average through May.

Faster than advertised expansion of Chinese Gold reserves no surprise

It may seem surprising that China is accumulating far more gold than they publicly admit, but it shouldn’t be. People who are paying attention have known this for a long time.

Last year, Money Metals’ researcher Jan Nieuwenhuijs parsed the data and determined that the Chinese central bank covertly bought 570 tonnes of gold in 2024. The People's Bank of China only reported a 41-tonne increase in its gold reserves that year.

Nieuwenhuijs’s numbers dovetail with Goldman’s.

“Since the Ukraine war began, data show, China’s central bank has been buying roughly five times more gold than what it discloses to the International Monetary Fund (IMF).”

His analysis of formal and informal sources indicated that at the time, the People’s Bank of China was sitting on more than 5,000 tonnes of monetary gold – more than TWICE what the Chinese publicly admit.

The mainstream media has all but ignored this story for years. However, it is starting to see the light of day. Last November, the Financial Times of London reported on the secret expansion of its gold reserves.

“China’s unreported gold purchases could be more than 10 times its official figures as it quietly tries to diversify away from the United States dollar, say analysts, highlighting the increasingly opaque sources of demand behind bullion’s record-breaking rally.”

Now Goldman has joined the party.

However, this secretive Chinese gold accumulation dates back much further than the last three or four years. Analyst Jim Rickards speculated that Chinese gold reserves were far larger than reported in this article published more than a decade ago.

“In mid-2015, China suddenly announced that its gold reserves had increased by 604 tonnes. The total rose from 1,054 tonnes to 1,658 tonnes. Since then, China has updated its gold reserve position monthly (in keeping with IMF criteria). All of these figures are misleading because China keeps several thousand tonnes of gold 'off the books' in a separate entity called the State Administration for Foreign Exchange (SAFE). Small amounts are transferred from SAFE to PBOC monthly, and that becomes the basis for the official reserve reports.”

Goldman noted that Chinese gold buying is part of a broader trend of central banks globally expanding reserves. Investing Live summed up the Goldman position.

 “Goldman continues to frame elevated central bank accumulation as a multi-year structural trend tied to reserve diversification away from dollar assets, anchoring its $4,900 per troy ounce end-2026 price forecast. With private portfolio allocations to gold still low, the bank sees room for demand to broaden beyond central banks to private investors if geopolitical risks continue to build, keeping the medium-term price skew to the upside.”

Goldman analysts said they expect central bank gold accumulation to provide a price floor for the yellow metal, even as gold continues to face downward price pressure due to a hawkish Federal Reserve.