A potential trade war with the U.S. that threatens growth, simmering tensions on the Korean peninsula and this year’s slump in gold prices are reasons to buy. But People’s Bank of China data show the country’s gold reserves haven’t risen since Donald Trump was elected President in 2016.
Still, this wouldn’t be the first time the central bank has kept silent while adding to its stash.
“The strategic imperative is probably still there to add some gold to reserves quietly bit by bit,” said Philip Klapwijk, managing director of Precious Metals Insights Ltd. a consultancy based in Hong Kong. “The reason to own gold as a portfolio diversification is even better given the rather strained relations with the US,” said Klapwijk, who has tracked precious metals for nearly 30 years.
China has officially kept its gold holdings unchanged at 59,24 million ounces since October 2016, or 1,843 metric tons, valuing them at $74,1 billion at end-June. Globally, central banks continue to increase gold reserves, albeit at a slower pace, adding 371,4 tons in 2017, according to the World Gold Council.
The PBOC referred Bloomberg inquiries to the State Administration of Foreign Exchange, which didn’t respond to a faxed request for comment. SAFE manages China’s foreign exchange and gold reserves and foreign currency assets.
The Asian nation has spent long periods before without revealing increases in gold holdings. When the central bank announced a 57 percent jump in reserves to 53,3 million ounces in July 2015, it was the first update in six years. In 2009, the country said it bought 14,6 million ounces since 2003. — Reuters.
Source : The Herald