Beware the Dragon's Gold Teeth
Source: Mineweb, Lawrence Williams (8/4/10)
"China further loosens controls on gold imports and exports."
Earlier this year, the WGC entered an agreement with China's—and the world's—largest bank the ICBC (state-owned, of course) to cooperate to promote gold investments in China.
Yesterday we learned China is further loosening its controls on the import and export of gold on one hand, and on the other it will also support Chinese company investment in overseas gold-mining projects.
Does anyone notice a pattern emerging here?
Eastern buying, and that from China in particular, will effectively put a floor under the gold price—and that floor seems to be rising continuously as seen in the gold price's stair step advances in recent months. A senior Chinese official has stated publicly that the country will buy gold on the dips so as not to disrupt the market and undermine the USD—and there is perhaps more than anecdotal evidence that the Chinese government is buying gold, effectively surreptitiously, for its reserves, but not disclosing this until it reckons it is opportune so to do. Last time it announced an increase in gold reserves it had in fact been accumulating the yellow metal for six years before it actually made the fact public.
But why should China hold back dissemination of this information?