PRIVATE HOUSEHOLDS in China are buying gold at a record rate, encouraged by the government, says Toronto's Globe & Mail today.
"The Asian economic superpower and its citizens are increasingly turning to the precious metal as a way to diversify their finances," the paper says, noting the growth in China's official central-bank Gold Bullion reserves, as well as the first quarter's 57% rise in private consumers' gold buying.
Last year Chinese households spent some $14 billion last year buying gold – "about 11% of global demand" the Globe & Mail reports. China's gold market was only de-regulated in 2002. Private gold-buying has averaged 13% year-on-year growth since 2005, says industry advocate the World Gold Council.
"In the year 2000, there wasn't literally an ounce of gold that moved around China without passing through the People's Bank of China," the Globe & Mail quotes Martin Murenbeeld, chief economist at DundeeWealth in Canada.
"People forget how far we've come in China. Contrast today, with the Shanghai Futures markets, open selling of gold to the public, new designs, new jewelry, government support for people investing in gold...It's night and day."
International dealers meantime report that this week's sharp drop in prices spurred "a lot of physical demand", led by Chinese traders buying gold.
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