China is now seriously turning its attention to gold. I continue to ask the question as to why buy gold. Well it appears that China has asked the same question and is accumulating the shin stuff rapidly. Year on year they are mining more and more, in 2010 they became the worlds largest miner, mining a total of 340 tonnes which rose to 361 tonnes in 2011.
Not only are China mining more gold than ever before but they are also importing more gold then they have been with imports tripling between 2010 and 2011.
In numerical terms China's demand for gold has increased by an average of 27% per year recently.
But it's not just the Chinese government that are accumulating gold it is recommending its citizens do the same which they are.
Why are they accumulating so much gold? Is it to bring them in line with the proportion of ordering exchange other countries hold in gold? If for example it was to bring itself in line with say Germany it would need to quadruple it's holding which would be massive as it currently holds around 1000 tonnes already.
So why buy gold? Because China is furiously accumulating it, this demand can't fail but to have a positive impact on the price.
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