China Could Be Hoarding Over 5,300 Tonnes of Gold, Might Create Price 'Perfect Storm'

A recent report from Jan Nieuwenhuijs, an expert in the Chinese gold market, has found that the actual gold reserves held by the People’s Bank of China might comprise over 5,300 tonnes, dwarfing official numbers. Nieuwenhuijs explains China might be a driving force behind increasing gold prices, as the country moves to hoarding gold to protect its economy from an impeding dollar debasement.

China Could Have a Covert Gold Stash of Over 5,300 Tonnes

China might be secretly hoarding more gold than what it has reported. A recent report by Chinese gold market expert Jan Nieuwenhuijs explains that the People’s Bank of China (PBOC) could be stashing more than 5,300 tonnes of gold, a number that dwarves the official numbers reported by the institution.

This “covert” number is calculated by subtracting the official reported purchases from the numbers reported by the World Gold Council. According to industry insiders consulted by Nieuwenhuijs, this excess would be largely created by the bank.

Following this logic, Nieuwenhuijs calculates the actual gold reserves held by China at 5,358 tonnes, a number way higher than the 2,250 tonnes officially reported by the PBOC.

Furthermore, Nieuwenhuijs explains that this demand, combined with the private demand of Chinese investors who have abandoned traditional investment sectors such as real estate and the stock market, has become a driving force for gold prices.

Nieuwenhuijs stated:

Strong covert purchases by the PBOC reflect hidden de-dollarization. Although the dollar is still the world’s premier reserve currency, China and other countries are trying to move away from it.

China might be preparing for an upcoming debasement of the U.S. dollar, and its further weaponization by the Western world, so this has pushed the PBOC on its 15-month continued buying spree. Nieuwenhuijs predicts that as gold prices go up, Western investors will also invest in gold, moved by the same fears of the PBOC, creating a “perfect storm” for the precious metal.

Several analysts have predicted gold prices going further up, even reaching the $2,600 mark per ounce.