Usually China makes the headlines with regard to its crashing real estate and slowing economy. Behind the scenes, however, the country is working hard to become a power players in the gold market.
The reasons are simple. China knows the past growth policies are not working anymore and is not sure how much time it has left before a serious economic crisis. So it is pushing to consolidate and further its power internationally by gaining more influence at the International Monetary Fund (IMF), setting up its own institutions like the Asian Infrastructure and Investment Bank (AIIB).
Gold is an integral part of all these operations and China again moved to improve its position in the pricing and trade of global gold. According to Xinhua, China and other other countries have set up the world’s largest physical gold fund under the tutelage of the Shanghai Gold Exchange, which also wants to create its own gold pricing mechanism.
Sixty countries have already signed up for the project which is supposed to reach $16.1 billion and facilitate central bank purchases for the member countries. The fund will also invest in gold mining projects in central Asia.
