At a time when much of Europe and the United States seems to be losing interest in the precious metals, the Chinese are once again showing their love for gold with the news that gold imports from HK into the mainland jumped 89 percent from the previous month to total 97,106 kilograms. This figure stands as the fourth highest month on record.
Chinese interest in gold remains strong, despite the opposite sentiment in the western Hemisphere
When taking out flows from China into HK, the net imports amount to 61 tons which is a level not seen since December 2012. Besides the drop in price, the general investment scene in China has seen some changes as of late, giving extra motivation for gold bugs to add to their stack. The Chinese government has looked to cool the housing market and other financial products aimed at profit seeking investors. Chinese demand for gold is expected to continue, especially if prices continue to hover at multi-year lows.
Even though China doesn’t publish official gold holdings, expectations continue to grow around how much gold China really possesses. The World Gold Council puts that number at around 1054 tons, but analysts estimate the actual number to be several times more than what is quoted. With gold serving as a status indicator among the new Chinese elite, lack of other investment options, and the inflationary spiral the world is heading towards – China’s hunger for gold might just be beginning.