DB-Precious Special Report All about China for gold-20250825

• We deepen our investigation into official demand which we see as alinchpin of gold outperformance. Gold has outperformed the financialmodel in three out of the past four years. In our view, there is a clear linkwith the immobilisation of Central Bank of Russia assets in 2022.

• A growing body of scholarship explores the legal justifications forforeign state asset seizure, which would otherwise be a contravention ofinternational law and bilateral investment treaties. Though not by anymeans settled, the heightened debate means reserve managers willtreat the regional and currency allocation of assets more carefully,particularly in countries not strategically aligned with the G7.

• Two-thirds of official gold demand is now unreported and cannot belinked to individual countries in the IMF data. Of the unreported volume,we estimate that China is responsible for 78% since 2020.

• Our concerns of a possible slowdown in official demand areunsubstantiated by any data as of yet, that would otherwise implydownward revisions to our gold price forecast. The early signs from Julydata indicate a steady second-half pace of official demand that supportour existing forecast of USD 3,350/oz in the fourth quarter and USD3,700/oz average in 2026.