China Encourages Gold Trading in Renminbi

Tue Aug 25 2026

China has designated gold a strategic metal of vital importance to national security amid growing global uncertainty. S&P Global believes this move signals China’s determination to further bolster its gold reserves and intensify support for its mining sector. These efforts will drive Chinese mining companies to expand, at a time when the growth of their global counterparts is slowing, and will help China maintain its position as the world’s largest consumer and producer of gold amid a fierce global race for the precious metal in developing countries.

China’s gold strategy is more comprehensive and sustainable than simply an attempt to “acquire” gold. It stems from long-term strategic objectives such as enhancing economic resilience and expanding the global use of the Chinese currency, the renminbi.

S&P expects these efforts to progress gradually and with sustained commitment, leading to a wide range of government measures, including building up gold reserves, encouraging gold trading in the Chinese currency, and supporting global gold exploration and production. The events following the escalation of the Russian-Ukrainian war in 2022 have given renewed impetus to these areas and contributed to a global gold rush among governments and individual savers—a trend exacerbated in China by the five-year slump in its real estate market.

Despite this, China’s gold holdings have grown at a slower pace and remain smaller than most countries as a percentage of official reserves. It ranks sixth globally in terms of size.

This trend of increasing stockpiles through purchases or production is likely to be supported. These factors have prompted major Chinese mining companies to accelerate their expansion both domestically and internationally, while their global counterparts have maintained stable production. Thanks to improved performance and a strong financial position, we expect these companies to continue this strategy without compromising their credit ratings.

In 2025, China opened its first offshore gold vault in Hong Kong as part of its “Gold Road” initiative. This vault will serve as a model for a future global network of gold vaults, supporting gold trading in yuan and the shift of the yuan toward a gold-backed currency outside the US dollar framework.

China is expected to press ahead with these and other gold-related plans as international tensions and conflicts persist. Amid the uncertainty surrounding the future, one thing is certain: China’s role in the global gold market will become even more entrenched and influential as these efforts come to fruition.

Source: https://maaal.com