Source: Zero Hedge
“After China’s official gold reserves rose for the first time in around two years (since Oct 2016) in December, Beijing appears to have joined the global gold rush, increasing its gold reserves for the third month in a row in February to 60.26 million ounces. China has long been silent on its holdings of gold as many countries are turning away from the greenback. Goldman Sachs has flagged central-bank buying as a plank supporting its bullish outlook for gold, which it expects to rally to $1,400 an ounce over six months. China is also trying ‘to diversify its reserves’ away from the greenback, according to Jeffrey Halley, senior market analyst at currency broker OANDA. The analyst told the South China Morning Post that the state of affairs in global politics, including a trade war with the US, are driving China’s interest to buy gold as a ‘safe haven hedge.’….One wonders if Alasdair Macleod is on to something when he notes that if the yuan is to replace the dollar for China’s trade, officials will have to back it with gold.”
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