Contact us
CALL US NOW 1-888-GOLD-160
(1-888-465-3160)

Imports of Gold into China via Hong Kong Surged Last Month

  by    0   1

Imports of gold into China via Hong Kong surged in March, rising 78.67% compared to February.

The amount of the yellow metal moving into mainland China via Hong Kong rose to 59.4 tons in March, up from 33.25 tons in February, according to data emailed to Reuters by the Hong Kong Census and Statistics Department. 

It’s difficult to gauge how much gold is actually moving into China because the country does not release that data. Gold imported to the mainland from Hong Kong serves as an indicator of gold demand in the world’s top consumer of the yellow metal. But Hong Kong data does not necessarily provide a full picture of Chinese gold purchases. The metal is also imported via Shanghai and Beijing.

The resurgence in imports from Hong Kong could signal a significant shift in overall gold demand in China. Imports fell 18.5% year-on-year in 2017 and were down 12.2% in December compared with November. The surge last month could indicate a reversal in the trend.

Commerzbank analyst Carsten Fritsch told Reuters investor demand in China was steady last year. The drop in imports was primarily due to “the complete absence of the Chinese central bank regarding gold purchases.”

The fact that the People’s Bank of China did not buy any gold last year left all domestically mined gold available to private households. As a result, the need to import gold dropped.”

Could the sudden spike in imports indicate the Chinese central bank has once again started buying gold?

In February, Russia passed China to become the world’s fifth-largest gold-holding country. But in 2016, the Chinese were also rapidly increasing their hoards of gold. In June 2015, the Chinese central bank announced its gold holdings had grown by 57% to about 1,658 tons. It was the first official update to China’s gold reserves since 2009. Over the next 18 months, the Chinese aggressively added to their holdings and took other steps to increase their influence on the world’s economic stage.

It remains unclear why China’s central bank put its gold purchasing on hold. In fact, it may not have. Many analysts believe the Chinese have significantly larger gold holdings than they report.

We won’t know for sure if the surge in imports from Hong Kong signals renewed central bank purchases until it releases that information. And it may not. The Chinese are notorious for shrouding their gold purchases and overall gold reserves in mystery.

The rise in imports could also be a factor of decreasing gold output in China. The country ranks as the top producer of gold, accounting for 15% of the world’s total gold production. Chinese mine production dropped by a record 9% in 2017.

Much of China’s gold stays in the country to feed the world’s largest gold market. Even as production dropped off last year, gold consumption in China grew 9.41%, according to information released by the China Gold Association.

Whether increasing gold imports into China are a function of decreasing supply, increasing demand, or both, it could have a significant impact on the global gold market if the trend continues.

WhyBuyGoldNowBanner.070815.590

Get Peter Schiff’s most important Gold headlines once per week – click here – for a free subscription to his exclusive weekly email updates.
Interested in learning how to buy gold and buy silver?
Call 1-888-GOLD-160 and speak with a Precious Metals Specialist today!


Related Posts

Fed Chair Powell Lets the Truth Slip Out

Every once in a while, the truth slips out of Federal Reserve Chairman Jerome Powell’s mouth. Powell was on Capitol Hill this week addressing Congress. He continued to talk up the economy, but in a moment of honesty, tacitly admitted that the central bank is already engaged in extraordinary monetary policy, and confessed the Fed […]

READ MORE →

If You Want to Understand the Constitution, Don’t Ask a Lawyer

Most Americans say the Constitution is important. Most Americans say it’s crucial for the government to stay within its constitutional bounds. But what exactly are the constitutional limits on federal power? How do we know? Well, whatever you do, don’t ask a lawyer. Most of them know very little about the Constitution.

READ MORE →

Borrowing Our Way to Prosperity?

Americans are driving the US economy along with borrowed money. The question is how much longer can it last? Consumer debt surged once again in December as Americans charged up their credit cards for the holidays. Total consumer credit grew by $22.1 billion in December, according to the latest data released by the Federal Reserve. […]

READ MORE →

Gold Holdings in Gold-Backed ETFs Hit All-Time High in January

ETF gold holding reached another record high in January, according to the latest data from the World Gold Council. Gold-backed funds added 61.7 tons of gold last month, boosting holdings to an all-time high of 2,947 tons. This continues a trend we saw in 2019 when gold holdings in ETFs grew 19% and eclipsed all-time […]

READ MORE →

Macy’s Puts a Face on Retailers’ Pain

Macy’s department store has announced plans to close 125 stores and cut around 2,000 corporate employees. Along with the store closures, the company will shutter its Cincinnati headquarters and tech offices in San Francisco. Even with the cuts, sales projections for the next three years “look abysmal.” According to CNBC,  same-store sales, on an owned […]

READ MORE →

Comments are closed.

Call Now