Leslie Hook
Financial Times
China has moved to liberalise its gold market further, increasing the number of banks allowed to trade bullion internationally and announcing measures that will encourage development of gold-linked investment products.
The move by Beijing’s central bank comes as the country’s investors pour record amounts of money into gold, in a trend that is becoming a significant factor on global prices.
Last year, Chinese investors bought 73 tonnes of bullion, up from 18 tonnes in 2007. The new policies were likely to increase liquidity in the domestic gold market and spur the development of gold financial products, analysts said.
China is the world’s largest gold producer and the second-largest consumer, after India, but its domestic market remains constrained by limited investment products.
“This is a positive sign for the gold market,” said James Steel, precious metals strategist at HSBC in New York.
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