An article on China reducing Gold exchanges to 2.http://www.wealthwire.com/news/global/2431?r=1Posted by Mike Tirone - Wednesday, December 28th, 2011
China has been on every gold watcher’s radar for quite sometime now. We have covered the frenzy in the far east for months now, explaining how China is hoarding gold or how the dollar is weakened by China buying so much of it. The country has been hit with the new age gold rush and today the stronghold of the Communist government has cracked down on the yellow-metal mania.
Today, Chinese authorities have banned all but two gold exchanges throughout the entire country. China, a country that reveres gold in its society and is one of the world’s largest holders of it, has seen gold exchanges rapidly growing all across the country.
Spot prices in gold have rocketed to record highs and speculation has jumped in parallel, causing exchange businesses to spread.
The Chinese government’s notice which was dated December 20th and issued by the People’s Bank of China, the Ministry of Public Safety and other agencies stated that “no local authority, institution or individual is allowed to set up gold exchanges.”
china gold exchange
The two legal gold exchanges that were not banned by the government are the Shanghai Gold Exchange and the Shanghai Futures Exchange, which they say are sufficient enough to meet domestic investor demand for spot gold and futures trading.
Existing exchanges or “platforms” were told to stop offering new services while the PBOC blamed lax management, irregular activities and evidence of illegality for the closures. They believed these were the reasons that were causing too much risks to emerge.
e we need to keep a close eye on spot gold in China as analysts believe this will dramatically impact the yellow-metal's prices.
