Gold Fell in September. China Bought the Most Since 2023.

China’s central bank added 740,000 ounces of gold in September. That’s the biggest monthly increase since September 2023, when it added 840,000.

Prices declined in September, per China Daily. And on Wednesday, spot gold fell 1% to $4,122.73.

The Buyer That Doesn’t Check the Chart

The People’s Bank of China now holds 77.47 million ounces. September was its 23rd consecutive month of buying, per the PBOC figures China Daily reported.

Look at the run-up. August added 650,000 ounces. July added 640,000. September stepped up again, and it did so as prices fell.

That’s the opposite of how most of us behave. I have bought into strength and felt smart, then frozen when the price dropped. A central bank with a long horizon and a printing press doesn’t do either. It just buys.

The Headwind Is Real Too

I’m not going to tell you this makes gold a one-way bet. It doesn’t. The 10-year Treasury yield sits around 5.3%, which FX Leaders calls gold’s biggest headwind. Kitco’s wire report has the dollar index up 0.4% on the day.

Traders are also waiting on the minutes from the Fed’s September meeting, due later today. The question is how much appetite officials have for more hikes. Kitco notes that markets still expect one in December, even with a pause expected this month.

Also note what China’s number does not do. It doesn’t set the price. A 740,000-ounce purchase didn’t stop gold from falling 1% on a day when the dollar and yields were pushing the other way.

What Else Is Holding It Up

Kitco’s report names the supports: geopolitical tension, government debt concerns, and continued central bank demand. China is the headline example of the last one.

One more data point, with a caveat. LBMA conference delegates projected gold could reach $5,013 an ounce within 12 months. That’s a room full of bullion people, so discount accordingly. It’s a mood reading, not a forecast.

The Bottom Line

Two forces are pulling on the same metal. Yields and the dollar push the price down in the short run. Official-sector buying keeps showing up underneath it.

For anyone stacking monthly, this changes nothing about the plan. Gold is lower than it was a month ago, and a very large buyer treated that as an opportunity. You can decide what that tells you. Watch the Fed minutes today and the October 28 meeting after that.