The People's Bank of China has been moving part of its gold reserves from London to Hong Kong and increasing the amount of bullion it holds in the city, deepening support for Hong Kong's push to become a major international gold trading hub. The transfer is seen as an endorsement of Hong Kong's gold clearing and settlement system, which began trial operations on July 7, 2026, and was developed by the Hong Kong Precious Metals Central Clearing Company Limited, a government-wholly-owned entity known as HKPMCC. The platform supports unallocated, international-standard gold transactions, with plans to connect to Hong Kong's Real-Time Gross Settlement system for Delivery-versus-Payment settlement. Hong Kong also launched the initial phase of Delivery Connect on July 7 to ease physical gold movement between Hong Kong and Shanghai under a January 2026 cooperation agreement with the Shanghai Gold Exchange. Officials are pairing the market infrastructure buildout with an ambition to expand vaulting capacity to more than 2,000 metric tons by 2030, alongside new price discovery tools and tax incentives aimed at gold exchange-traded funds. The push also fits a broader reassessment by central banks over where to hold precious metals as geopolitical risks rise, with India and Serbia among those reported to be repatriating part of their overseas gold. China has paired that infrastructure drive with continued official buying: the PBOC increased its gold holdings for a 20th straight month in June, with the monthly purchase reaching its highest since October 2023, underscoring a wider reserve diversification strategy.