China is flexing it’s muscles once again in the global market. This time, in gold.
The world’s biggest producer and leading user of the commodity is planning its own gold fix, according to Reuters, and it could be launched by the end of this year.
The gold fix, denominated in the Chinese currency, will be done through Shanghai Gold Exchange, the top physical bullion market in the world, the report said.
If the plan pushed through, the yuan gold fix may relegate the London fix to a supporting role in the country.
Reuters wrote:
“Given its leading role in gold, China feels it is entitled to be a price-setter for bullion and is asserting itself at a time when the global benchmark, the century-old London fix, is under scrutiny for alleged price-manipulation.”
The planned yuan gold fix also comes at a time when Chinese imports of gold have fallen. According to The Wall Street Journal, China’s gold imports slipped 7% in the first quarter of this year from the same period in 2014. For the whole of 2015, Chinese gold imports may drop by up to 20%, WSJ said, citing an analyst.
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