China's gold reserves were valued at $208.64 billion at the end of last month, up from $206.53 billion at the end of January, central bank data showed on Friday.

"The PBOC's purchases are an important factor underpinning gold, so a continuation of its buying in February could help to build further strength behind the gold price," said Frank Watson, market analyst at Kinesis Money.

U.S. import tariff fears, their potential effect on global economic growth and inflation as well as geopolitical uncertainty drove gold to a record high on February 24. Bullion rose by 27% in 2024, the most in 14 years.

Washington has so far added an extra 20 percentage points on existing tariffs for Chinese goods, with the latest 10-point increment enforced on Tuesday, drawing Beijing's retaliation.

China unlocked more fiscal stimulus on Wednesday, promising greater efforts to support consumption and cushion the impact of an escalating trade war with the U.S, while China's state planner said the country would accelerate the annual stockpiling of strategic commodities.

Global central banks, a major source of gold demand, bought more than 1,000 metric tons of the metal for the third year in a row in 2024 and are expected to remain active buyers in 2025, according to the World Gold Council.

"Unlike investors, central banks are relatively price insensitive to gold and tend to buy as part of a restructuring of their reserve holdings," Watson said.

"Buying by the PBOC and other central banks has been a key factor for gold's very strong price performance over the last two years. That said, other factors, like inflation, interest rates, geopolitical events and investor interest in safe haven assets will continue to shape the gold price."

In 2024, the PBOC took a six-month pause after its 18-month-long gold purchasing spree before resuming the gold buying in November.