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China's gold reserves rose from $71.48 to $74.75 billion in the month of April, according to the Latest figures of the central bank. The increase can be attributed partly to an expansion of the gold stock and partly to the higher Gold price. Converted, the central bank added almost 11 tonnes to its reserves, bringing the total reserve to 1,808.4 tonnes. This puts the country in fifth place in the World Gold Council ranking of countries with the largest gold reserves, behind the United States, Germany, Italy and France.
China's central bank remains uninterrupted Physical Gold and has been reporting monthly on the size of gold reserves and foreign exchange reserves since June last year. The central bank does this in the context of transparency and to comply with the international standards of the IMF. Disclosure about the reserves was a requirement for China to be allowed to participate in the SDR, an alternative world reserve currency based on a basket of different currencies.
Before then, China was very reluctant to release information. For 2015, the central bank has only announced an expansion of the stock of precious metals twice, namely in 2002 and 2009. The following graph shows the development since 2001.
China's total gold reserves since 2001 (Source: SAFE)
Since the outbreak of the financial crisis in 2008, China has tripled its gold reserves in order to diversify its dollar reserves. China has added an average of more than 15 tonnes of gold per month to its stock since July last year. Relative to China's total reserves, its position in precious metals represents only a share of 2.5%. Most of it is still made up of foreign exchange reserves, mainly U.S. Treasury bonds.
Since the beginning of this year, China's central bank has added 46.4 tonnes of gold to its reserves. Analysts at Barclays expect the country to have a total of 215 tonnes to its reserves.
Chinese gold stock rises to 2.25% of total reserves (Source: SAFE)
