Earlier, market watchers reported that Chinese exports to the US had fallen by 16 percent year-on-year in August, while imports from the US sagged by over 22 percent in the same period. The slump came as the US slapped a 15 percent tariff on the remaining $300 billion-worth of goods imported from China, with the tax stepping into effect on September 1.
China’s gold reserves climbed by some 99.91 tonnes over the past nine months, with total gold reserves standing at 2,141 tonnes as of August 30, and foreign exchange reserves growing to $3.1 trillion, according to fresh figures from the People’s Bank of China released over the weekend.
Between July and August alone, the value of China’s gold hoard is said to have climbed by over $7.5 billion, from $87.87 to $95.45 billion, with the country buying 5.91 tonnes of the precious metal in the last month.
China’s total gold reserves had stood at 2,042 tonnes of the precious metal as of the end of December 2018, with the August figures meaning China’s total holdings in tonnes had grown by 4.85 percent.
The New Case for Gold Best Price: $0.25 Buy New $6.99 (as of 11:36 EST - Details) Last week, Bloomberg reported that gold prices have climbed by a whopping 19 percent since the start of the year, in part due to central banks’ purchase of the precious metal, and in part due to economic uncertainties stemming from global trade conflicts, and fears of a US recession. The metal hit $1,555 per ounce in trading in late August, its highest value since 2013, and investment banks including Goldman Sachs expect prices to continue their steady climb.
China isn’t the only country building up its gold reserves. On Sunday, Russian central bank data showed that Moscow’s gold reserves similarly climbed over the past month, growing in value by $7.5 billion between July and August with total bullion reserves presently valued at $109.5 billion. Moscow’s gold hoard stood at 2,217.68 tonnes as of the end of July, with the country buying at least 106 tonnes of the precious metal so far in 2019.
Russian and Chinese reserves are now approaching those of Italy, (2,451.8 tonnes) and France (2,436.1 tonnes), whose holdings are said to be the third and fourth-largest in the world after the US and Germany (who are said to have had 8,133 tonnes and 3,381 tonnes in their vaults as of early 2019, respectively).
The two countries’ gold hoarding comes amid growing concerns over the state of the global economy, and a bid to diversify reserves away from US dollar-denominated holdings. Along with Moscow and Beijing, other countries, including Poland, have sought to expand their gold reserves in recent months, with the World Gold Council calculating earlier this year that central banks worldwide had bought up a total of 374 tonnes of gold worth $15.7 billion in the first half of 2019, with the purchase becoming the largest-ever acquisition of the precious metal by public institutions in the first six months of a calendar year on record.
US-China Trade Spat Shows No Signs of Slowing
The Case for Gold Best Price: $3.85 Buy New $4.74 (as of 10:47 EST - Details) Earlier this week, economists calculated that trade between economic giants the US and China has seen faced a substantial decline over the past year, amid the continually escalating trade spat between the two countries. Last Friday, White House Chief Economic Advisor Larry Kudlow promised that “all topics” would “be on the table” at October’s trade talks amid growing economic concerns in both countries. The multi-trillion dollar trade war has helped cause a 17-year low in Chinese industrial growth in July, while CNN reported last week that US President Donald Trump had privately expressed fears about a recession hampering his chances at reelection in 2020.
New US anti-China trade tariffs went into effect on September 1, with the US placing a 15 percent import levy on $300 billion in Chinese goods –with US tariffs now accounting for virtually the entirety of Chinese products entering the country. The Trump administration began the trade conflict with China in May 2018, in a bid to rebuild the US industrial base amid what he said was Beijing’s “unfair” trade practices and currency manipulation. The tariff war escalated following several rounds of back and forth retaliations.
Reprinted from Sputnik news.