China has lowered its US Treasury holdings for the third month in a row, opting to hoard large amounts of gold bullion instead.
According to the latest data from the US Treasury, China lowered its T-Bill holdings by $900 million, from $757.2 billion in April to $756.3 billion in the month of May.
The sell-off marks China’s third straight shedding of Treasuries since February, when the Asian powerhouse held $784.3 billion worth of US bonds.
Meanwhile, reports that China is covertly buying much more gold than what public numbers disclose are making the rounds.
Stefan Gleason, president and chief executive at Money Metals, tells MarketWatch that China is likely downplaying its gold purchases for efficiency’s sake.
“Given how much gold it’s buying, it’s quite sensible for China to limit public disclosures where possible… After all, it’s not in the interest of any bona-fide buyer to take actions that make its purchases more expensive than they need to be.”
Joseph Cavatoni, market strategist at the World Gold Council, says that there is debate over “whether the PBOC’s (People’s Bank of China) reported purchases fully capture its activity.”
The analyst also admitted that there is “always the case that maybe more is going on than is reported.”
And Jan Nieuwenhuijs, an analyst at Money Metals, says that China’s gold holdings are likely more than double what is officially reported.
Nieuwenhuijs says that “in reality,” the PBOC held 5,065 metric tons of gold in its reserve at the end of 2024, which pales in comparison to its reported holdings of 2,280 metric tons.
“China [is] importing much more gold than what is sold in the private market through the Shanghai Gold Exchange, and what industry insiders have shared with me over the years.”
The latest data from the World Gold Council shows that China holds 2,296 tonnes of gold worth more than $247 billion.
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