China's political authorities have given Chinese and international banks permission to import additional gold, Reuters reported. The agency cites reliable sources. If this really happens, then this news may support the global gold market, and hence the value of the precious metal itself.
The report also reads: “With China's economy showing solid recovery in the second half of last 2020, the demand for gold jewelry, bullion and coins has shown significant growth. This factor has largely supported the world prices for the yellow precious metal, and the import of gold to the PRC has again become a profitable business. "
According to analysts, the import of 150 tons of gold may take place in April-May this year. Its cost will be approximately US $ 8.5 billion. If this really happens, then this event will be reflected in the Swiss customs statistics. The fact is that Swiss refineries process more than half of the world's gold supply. China is one of the recipients of the precious metal from the Alpine Republic.
From time to time, there are rumors in the gold market that China is planning to introduce a new currency backed by a physical precious metal. The economic portal Zero Hedge recently tried to develop this idea again. It is also worth recalling that the PRC authorities have kept their real gold reserves secret for a long time. If the goal were to really create a precious metal backed currency, then openness in this matter would benefit this intention.
China's gold reserves were last reported in June 2019. Since then, this indicator has been at the level of 1948.31 tons, although from 2015 to 2019. this Asian country bought large quantities of the yellow precious metal every month. Any official information on China's gold reserves affects, to a greater or lesser extent, the world gold price.