http://www.reuters.com/article/2011/02/16/us-icbc-gold-idUSTRE71F1MO20110216 China gold demand growing at "explosive" pace: ICBC (Reuters) - Demand in China for physical gold and gold-related investments is growing at an "explosive" pace and its appetite for the yellow metal is poised to remain robust amid inflation concerns, said an Industrial and Commercial Bank of China (ICBC) executive. ICBC (1398.HK)(601398.SS), the world's largest bank by market value, sold about 7 tonnes of physical gold in January this year, nearly half the 15 tonnes of bullion sold in the whole of 2010, said Zhou Ming, deputy head of the bank's precious metals department on Wednesday. "We are seeing explosive demand for gold. As Chinese get wealthy, they look to diversify their investments and gold stands out as a good hedge against inflation," Zhou told Reuters. "There is also frantic demand for non-physical gold investments. We issued 1 billion yuan worth of gold-price-linked term deposits in 2010, but we managed to sell the same amount over just a few days in January this year," Zhou said, adding that such deposits would easily exceed 5 billion yuan ($759 million) this year. Gold imports into China soared in 2010, turning the country, already the largest bullion miner, into a major overseas buyer for the first time. The surge, which comes as Chinese investors look for insurance against rising inflation and currency appreciation, puts the country on track to overtake India as the world's top gold consumer and a significant force in global gold prices. Gold prices jumped 30 percent in 2010 and struck an all-time high of $1430.95. Spot silver surged 83 percent last year and is currently hovering at around $30 per ounce. Zhou said China's gold demand could grow at a stronger pace this year compared with 2010, as a choppy stock market and moves by Beijing to rein in property speculation and purchases means more investors will pile their cash in bullion investments. "Unlike the property market, investment in the gold sector is something the government is encouraging," he said. Beijing has encouraged retail consumption and announced last August measures to promote and regulate the local gold market, including expanding the number of banks allowed to import bullion. "China has a centuries-long cultural attraction to gold and because we have started at such a low base, I think demand growth will likely stay strong for quite some time," he said. Zhou said there was also voracious demand for silver, with the bank selling about 13 tonnes of physical silver in January alone, compared with 33 tonnes in the whole of 2010. The scale of China's gold demand, which has increased on average at a double-digit clip over the past decade, has caught the market by surprise. Data showed China imported 209 tonnes of gold the first 10 months of last year, versus 333 tonnes by India for the whole year. The bank on Tuesday launched its second physical gold investment product, which sells gold bars to investors, which can be resold for cash through ICBC based on real-time gold prices. The WGC said ICBC's introduction of this gold investment could lift China's gold retail investment by 10 to 15 percent in 2011 from about 170 tonnes last year. (Editing by Chris Lewis)
More likely the powers in western nations know what is coming and know they cannot stop it. They're raiding the cupboard bare before it all goes to hell and hoping you won't notice. I'm noticing it. :/
U just wondering myself why USA and other countries don't buy gold&silver, they r already printing money without cover so it is actually free for them??? Only conclusion is that in case of STHF scenario they will not need it, what means that were r wrong about our investment. Maybe we should reconsider scenario for judgment day?
It is a Reuters article. So we better check our facts. "into a major overseas buyer for the first time" - anyone believe that? "Chinese investors look for insurance against rising inflation and currency appreciation" - hang on, last time I looked these two issues were sides of the same coin. Why would you invest in gold as insurance against currency appreciation, assuming we are talking about the RMB? You might invest in gold when the currency appreciates, to take advantage of purchasing power, but surely not as insurance against appreciation. Unless I'm missing something... This part got my attention in a good way: Anyone know more about the specifics?
