“They are continuing to diversify their foreign reserve holdings,” Ole Hansen, an analyst at Saxo Bank A/S in Copenhagen, said by phone. “They’re thinking long term and they see this as an opportunity to accumulate while the prices have come down.”
China’s gold reserves rose by 14 tons in October, 15 tons in
September, 16 tons in August and 19 tons in July. It disclosed
on July 17 that holdings had surged 57 percent since 2009. While
the country has overtaken Russia to own the world’s
fifth-largest hoard, it still has only about 1.6 percent of its
reserves in gold, compared with 73 percent for the U.S. and 67
percent for Germany, World Gold Council data show.
Russia and Kazakhstan are buying along with China as prices head
for a third annual decline on prospects that the U.S. will
increase interest rates this month for the first time since
2006. Central banks and other institutions boosted gold
purchases to the second-highest level on record in the quarter
to September, according to the council.