The People’s Bank of China v. …. Costco! In the gold market.
In August 2023 it became possible to buy hunks of the metal at Costco, an American superstore beloved by the cost-conscious middle classes for selling jumbo-size packs of toilet paper … The retailer started selling single-ounce bars of gold, mostly online, for around $2,000—just a hair higher than the spot value of bullion at the time. It sold out almost immediately, and continues to do so whenever it restocks. Analysts at Wells Fargo, a bank, estimate that shoppers are buying $100m-200m worth of gold each month from the superstore … That would be 40,000 to 80,000 ounces of gold each month; or, in other words, up to half as much as the Chinese central bank (which is raising gold from the share of its reserves held in gold from 3.3% at the end of 2021 to 4.3%.) Such behaviour is perhaps a harbinger of a trend. Inflation in America is creeping up again. … As shoppers peruse Costco’s wares, worrying about the cost of living, it is it any wonder they are tempted by a bit of bullion?
Source: Economist