~@ Just received a call from a well informed source who works internationally and has been watching, the international monetary scene intently! … This is BIG and yesterdays headlines seem to foretell, what we are seeing today… If we don’t make an active attempt to find the info, we may be among the last to know…. 🙂
China launches its first gold ‘fix’
In an effort to have greater access and control over the international gold market, China, the world’s biggest producer and consumer of gold, announced on Tuesday it launched its own benchmark, or “fix,” for the price of gold.
The Shanghai Gold Exchange, which operates the benchmark, set the price for 99.99% gold at 256.92 yuan ($39.71) per gram, it said on its website. This was marginally higher than the international price at the time, according to goldprice.org.
“China needs a gold benchmark that reflects local market flows and reduces gold’s price dependency on the US dollar,” Roland Wang, managing director of industry group the World Gold Council in China, said in a statement.
“An Asian-focused, yuan-denominated benchmark will significantly increase the liquidity and efficiency of the gold price,” he said.
Last year, mainland China’s demand for gold was 984.5 tonnes, with jewelry at 783.5 tonnes, and bars and coins at 201 tonnes, according to the World Gold Council in China.
Analysts said denominating the gold fix in China’s own yuan currency is aimed at increasing international use of the unit.
“Having more sway in the gold market befits the long-term strategy of expanding the yuan’s role as a global currency,” Jiang Shu, chief analyst at Shandong Gold Financial Holdings Capital Management, told Bloomberg News.
In December, Jiao Jinpu, the head of the Shanghai Gold Exchange, said that launching a yuan-dominated benchmark for gold would promote “internationalization” of its business.
The exchange has said it ‘s looking into creating yuan-based benchmarks for other precious metals including silver, platinum and palladium, according to domestic media reports.