Gold prices are surging. Is this partly linked to China reducing its exposure to U.S. Treasuries while G7 nations absorb a large share of the supply?
There are reports that China has been steadily cutting Treasury holdings possibly realizing losses while reallocating reserves into gold and other physical commodities to reduce dollar dependence. At the same time, G7 countries appear to be stepping in as buyers of U.S. government debt, effectively recycling the supply.
From a macro perspective, does this point to a structural shift in the global reserve system, or is it just cyclical positioning driven by real rates, geopolitics and risk aversion?
How sustainable is the current gold rally if this dynamic continues?