This demonstrates the “sharing” of China’s gold stocks between the government and its people and that “the policy of ‘gold held by the people’ has been well achieved”.

China has been making it very clear that it wants more control over the global gold market, but it’ll have to go through New York and London first.

“Given that China is the epicenter of the physical gold market, it does make sense that the Chinese government would want its physical Shanghai gold market to supplant the Comex derivative market (and others) as the primary global price-setting mechanism,”

We cannot understand today’s gold market without understanding the role China and, in a different way, India play in it. The gold market in general is very opaque and the Chinese one, in particular, is even more. In this article, I will look at China’s role in the gold market. In 1950, communist China prohibited private ownership of bullion and put the gold industry under state control. Fifty years later the People’s Bank of China abandoned its monopoly on the purchase, allocation and pricing of gold. In 2004, for the first time since 1950, private persons were permitted to own and trade gold. China has become the most important physical gold market in the world. It is now both the number one producer and consumer of gold. The World Gold Council, in a recent report on China and gold, expects the Chinese private sector gold demand to be at least 1,350 tonnes by 2017. Today China is the world’s largest market for gold bars, in part because of successful development initiatives by the major chinese banks.