The push and pull of central bank gold: China buys 5 tonnes and Turkey monetizes 118 tonnes in March

Updated reserve data from the People’s Bank of China shows that the central bank bought 5 tonnes of gold last month. Krishan Gopaul, Senior Analyst, EMEA at the World Gold Council (WGC), said in a social media post that this is China’s biggest purchase since February 2025.

“This also extends its monthly increases to 17 consecutive months,” he said. “Its gold holdings now total 2,313 tonnes.”

Analysts have said that, despite market volatility, there are strong expectations that China will continue to buy gold to strengthen the value of the yuan in an attempt to establish it as another global reserve currency.

China’s increased pace of purchases came as gold prices saw their worst monthly decline, falling 11.5% last month. Analysts have noted that central bank demand is not price-sensitive; however, they can be opportunistic and buy when prices have corrected.

Although China remains a committed gold buyer, the sovereign segment of the gold market has become much more volatile, as some analysts speculate that central banks have had to monetize their gold reserves to protect their economies, which have been impacted by the ongoing war with Iran.

So far, Turkey’s central bank has been the most transparent regarding its official reserves. Data from the central bank showed that its gold holdings declined by another 69.1 tonnes, bringing last month’s total decline to more than 118 tonnes.

According to reports, this is the biggest drawdown in Turkey’s gold reserves since 2013.

The central bank has said that it has sold some of its gold but has monetized most of it through swap agreements. It has used this liquidity to buy lira and other foreign currencies to support its economy.

The ongoing war in the Middle East is significantly impacting global economic activity, as disruptions to the global supply chain—particularly in the energy market—are driving inflationary pressures higher.