China boosts gold purchasing as trade war deepens

  • by Ofeed Team
  • June 10, 2019, 17:7 AM
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China has added to its national gold reserves for the 6th consecutive month in May, according to the latest figures by the People's Bank of China released on Monday.

The central bank’s monthly figures revealed that the Chinese government increased its bullion reserves to 61.61 million ounces in May, up from 61.10 million the previous month, which meant an increase by 15.86 tons, after nearly 58 tons added in the country’s stockpile within the period of five months.

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China, the world's largest producer and consumer of gold, is facing signs of economic slowdown after the U.S. administration has announced further increase in tariffs on Chinese imports and blacklisted Huawei Technologies Co. from cooperating with US companies.  

The latest data from the PBOC indicated that the country has resumed adding gold to its reserves steadily, much like the period from mid-2015 to October 2016 when the government boosted acquisitions almost every month.

The precious metal reached its highest level since April 2018 last week, as prices have risen over the past three weeks, on bets the Federal Reserve may cut interest rates to stand against the impact of the escalating trade war between the U.S. and China.  

In the meantime, spot prices for gold have dropped by 1.21 percent at $1,329.85 this after gaining 1.7 percent in May.  

After the declaration by the world gold council that the first quarter purchases were the highest in six years, many central banks all over the world, especially from emerging markets, are increasing their gold holdings.

Ofeed Team

Ofeed’s team is comprised of highly distinguished analysts, with a wide experience in financial markets, having a unique analytical view of developments impacting global financial markets

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