Mainland China further increased its gold holdings in August, albeit at a slower pace compared to July, the central bank said on Wednesday, as it looks to diversify its foreign exchange reserves. China's gold reserves stood at 54.45 million troy ounces at the end of August, up from 53.93 million in July, the People's Bank of China said. The 520,000 ounces of additional gold amounts to 16.2 tonnes, bringing total holdings to 1,693.584 tonnes. China added nearly 19 tonnes of gold to its reserves in July. The slowdown in gold purchases in August came as China's foreign exchange reserves, the world's largest, shrank by a record US$93.9 billion, reflecting Beijing's attempts to halt a slide in the yuan and stabilise financial markets. China is the world's sixth-largest official sector gold holder after the United States, Germany, the International Monetary Fund, Italy and France. "The PBOC will increase its gold reserves continually," said Jiang Shu, chief analyst at Shandong Gold Group in Shanghai. The central bank would continue to buy at the same pace unless there was a big drop in prices, which could trigger higher purchases, he said. Despite the increase in August, China's gold reserves make up only 1.7 per cent of its total reserves, according to calculations based on PBOC data. The US, with more than 8,000 tonnes of bullion, has nearly 73 per cent of its total foreign reserves in gold, according to the World Gold Council. Russia, the seventh-biggest holder of gold reserves, has about 13 per cent of reserves in gold. It added 29.5 tonnes of gold to its reserves in August, IMF data showed last month. China had previously considered its gold holdings a state secret and did not report its holdings to the International Monetary Fund on a monthly basis, as most countries do. It began updating its reserve figures on a monthly basis in June, in a bid to increase transparency as Beijing campaigns for the yuan's inclusion in the IMF's special drawing rights basket. Before June, China had last revealed its holdings in April 2009.