How Much Gold Does China Need to End Its Dollar Dependence
Since 2023, China has acquired more than 290 metric tons of gold, making it the largest buyer among central banks.
Quick overview
- The People's Bank of China has significantly increased its gold purchases, aiming to reduce reliance on the U.S. dollar and bolster the yuan's global standing.
- Since 2023, China has acquired over 290 metric tons of gold, making it the largest central bank buyer, with reserves now totaling 2,300 tons valued at approximately $244 billion.
- Despite gold prices reaching historic highs, China continues to buy gold as a strategic hedge against geopolitical risks and financial sanctions.
- Analysts suggest that China may need to increase its gold reserves to between 5,000 and 8,000 tons to effectively position the yuan as a reserve currency.
The People’s Bank of China (PBoC) has stepped up gold purchases, fueling the rally in the precious metal and underscoring Beijing’s long-term strategy to reduce reliance on the U.S. dollar while strengthening the yuan’s position as a global alternative.
Since 2023, China has acquired more than 290 metric tons of gold, making it the largest buyer among central banks. In 2025 alone, it has added another 21 tons, bringing official reserves to 2,300 tons—valued at roughly $244 billion.
China Keeps Buying Despite Record Prices
The move comes as gold reached a historic high of $3,608 per troy ounce this week. Typically, central banks slow purchases when prices peak. But heightened geopolitical risks and the fear of financial sanctions have turned gold into a strategic hedge for many emerging economies.
The precedent of Russia—whose dollar- and euro-denominated reserves were frozen in 2022—remains a powerful lesson shaping monetary policy elsewhere.
Currently, China’s gold reserves account for only 7% of its total international holdings, far below the global average of 22% and well under the U.S., which holds more than 8,100 tons of gold (78% of its reserves).
How Much Would Be Enough?
Analysts say China’s current stockpile is still modest compared to its economic size. Some domestic voices argue a minimum of 5,000 tons would be required, while others suggest Beijing may eventually need to surpass 8,000 tons if it aims to anchor the yuan as a reserve currency on par with the dollar.
Poland offers a revealing comparison: Warsaw added 287 tons between 2023 and 2025, meeting its goal of having gold represent 20% of reserves. The move was largely driven by proximity to the war in Ukraine and a push to strengthen financial stability.
For China, the challenge is scale. Its foreign reserves total $3.6 trillion, meaning that raising the share of gold requires sustained, large-scale purchases. However, as the world’s largest gold producer—accounting for 8% of global supply—and with potential undeclared holdings at state-owned institutions, Beijing may be able to accelerate the process.
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