China just announced that it bought more gold in May 2026 than at any point since 2024 – when gold sold for under $2,700/oz.
Data also came out that China’s gold imports rose 40% year over year in April, up to 157 tonnes – the largest amount of gold imported to the country since March 2024.
The point: China is not slowing its gold purchases. And China still has a de facto ban on gold exports too – meaning that as it peels off its U.S. Treasury position, it’s shifting to gold. No gold leaves China – only USD.
The chart above shows the dollar amount of U.S. Treasuries in billions that China holds. It’s now down to ~$650 billion. You can see that since 2021, China has aggressively dumped Treasuries. They’re almost done! At the pace they’ve been selling Treasuries lately, they’ll be down to zero Treasury holdings by this time next year.
$650 billion is really nothing when it comes to the U.S. Treasury market – which means that China has very minimal direct exposure to the dollar. When they held $1 trillion+ it was a different story…
This chart shows U.S. Gold ETF flows for 2026, in blue. On net, over $3 billion left U.S. gold ETFs this year.
These outflows from the U.S. mean that on some level, the West is selling gold to China in exchange for dollars. They get our gold, we get our dollars back. Not a great deal.
It reminds me of President Trump’s quote about President Obama’s Iran deal:
The worst part is we didn’t even negotiate this deal. We’re just enacting it: sending precious metals to Asia in exchange for USD, slowly but surely.
Gold price weakness is not having the same effect on Chinese gold buying as it is on American gold buying.
We’re on two very different paths – with the U.S. operating under a conceit of normalcy, while China and other countries are plotting a new course that does not center the dollar in any way. A big part of this shift is seen in the End of the Petrodollar which is a trend I’ve written about at length here.
I think western investors who are serious about this gold market should contextualize the current correction in global terms. Yes, the price of the metal is down for the year – but the arc of what’s happening around the world with regard to the shift from the dollar to gold is still very much intact.
A year from now, I believe the story will be very different.
Imagine the headlines in June 2027: “China Now Owns ZERO U.S. Treasuries, Gold Purchases Soar.”
Have a great weekend.
Best,
Garrett Goggin, CFA, CMT
Lead Analyst and Founder, Golden Portfolio
