2011-11-10 — mineweb.com
Given that it is largely believed that the Chinese state is taking in all its own mined gold (it is currently the world's largest gold producer) into its reserves without declaring the increase, the combined offtake within China of market purchases by the general population plus the amount being taken into its state coffers will soon be getting perhaps close to one third of total world gold output and rising ever faster.
So what is China's plan with gold? There almost certainly is one. It can't be a case of tying up global supplies like it has with those critical metals because it doesn't, and can't, control enough of global supply to do that. The logical conclusion is that China is building its total reserves within the country in terms of both its government holdings and as an investment for individuals as it is convinced that the only way for the gold price to go is upwards, and perhaps the only way for the US Dollar and Euro to go is downwards - and ultimately, several years hence, it will move towards making the renminbi either the world's global reserve currency, or a significant part of it and reap the kind of benefits the USA has been able to since the dollar became the de facto global reserve currency.
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