Numbers for China’s gold imports from Hong Kong for the month of September is out. Net gold imports from Hong Kong were 109.4 metric tons. This was slighly lower than the import figures in August.
Nevertheless, these are very strong numbers showing China’s high demand for physical gold. It marks the fifth consecutive month that gold import numbers are in excess of 100 metric tons. In the first 9 months of 2013, China has imported an estimated 832 metric tons of gold. The Chinese are already the No. 1 gold mining nation today and they are enroute to become the No. 1 buyer of gold this year.
Such strong gold import numbers continue to support the view that China is accumulating her gold reserves. This is in line with China’s intention to prepare for the on-going efforts to internationalise the renminbi and reduce potential currency exchange risks of using the US dollar.
In today’s fiat currency dominated world, it is easy to lose sight of the true value of gold when it is relegated to being a commodity traded with other commodities (such as corn, cattle or copper) on the futures market. China’s immense gold appetite and increased gold purchases by central banks show the true value of gold as the form of money that anchors confidence when currency risks abound.