China Scoops Up More Gold for Reserves During Trade War
Has now added 94 tonnes since the current buying run started in December
There is a powerful constant amid the to-and-fro of the US-China trade war as currency policy gets dragged into the standoff between the world’s two top economies: Beijing wants more gold in its reserves.
China’s central bank expanded gold reserves again in July, pressing on with a run that stretches back to December. The People’s Bank of China (PBOC) raised holdings to 62.26m ounces from 61.94m a month earlier, according to data on its website. In tonnage terms, the inflow was close to 10 tonnes, following the addition of about 84 tonnes in the seven months to June.
Gold has rallied in 2019 to a hit a six-year high as global growth stutters, central banks including the Federal Reserve eased policy, and the festering trade war all combined to bolster demand. Increased central-bank buying from China to Russia and Poland has helped to buttress consumption at a time of rising prices. This week (ending 9 August), the conflict between Washington and Beijing worsened as the yuan was allowed to breach a key level, reinforcing the case for havens.
Gold futures rose as much as 1.3% to USD1,503.30 an ounce on Wednesday (7 August), the highest since 2013, before trading at USD1,500.70 at 11:26 am in London.
“This fits with China’s well-established pattern of increasing gold reserves month after month but not in a large enough volume to disrupt the gold market,” said a senior commodities economist. “We expect them to continue this trend as part of their long-term strategy to diversify their foreign exchange reserves.”
“Bear in mind that China is the largest mine producer of gold in the world,” a strategist added. “The state can always buy local mine production using local currency”, he said. – Bloomberg News.
The Shanghai Composite Index slipped 0.32% to 2,768.68 on Wednesday while Hong Kong’s Hang Seng Index rose 0.08% to 25,997.03.
Source: Bloomberg
[…] Has now added 94 tonnes since the current buying run started in December […]
The Anglo Americans have been covertly repressing the price of gold for years–contradicting their “Free Market” propaganda in the process.
One reason is that Gold is a much more credible basis of wealth and value than … say … the artificially propped-up American Dollar Reserve currency.
When the big slap comes, and it’s imminent, if you haven’t Gold ….you’re goosed. America has none ( it would take 3.5 million tons to pay off America’s total debt ). Any country that has entrusted the US, or the UK, to store their gold is also goosed…..these are the two biggest thieves on the planet !
this is a bs appraisal, what was domestic production and what were external purchases? what was internal consumer consumption? so the net addition to the state reserves was what? worthless article
english is a 2nd or 3rd language for you?
without question China raised their reported holdings, which does not even indirectly address the effect on world demand
I heard a rumor the fed was so short on gold to back their paper gold scam, they have a team digging up graves looking for gold teeth and wedding bands.
Remember, NO ONE, is allowed to audit Ft. Knox or Not Fed, No reserves and not a bank vaults.
Paper gold isn’t worth the paper it’s written on, bit like the dollar. Lot of people in for a shock when they want to get hands on their ‘gold’. If you buy gold, which you should (or silver which is doing well too) get it in your hand, store it yourself or in a safety deposit box, don’t buy paper gold, it is worthless.
Safety deposit box can be opened and contents seized by HLS anytime they feel froggy.
That ruling was made years back.
A mason jar buried by the dark of the moon is safer than a safe deposit box.