Gold and silver have been the dominant currency throughout human history. With the expansion of gold and silver stocks expanding at roughly the same rate as the global population, metals remain one of the best ways to ensure a stable currency value.

China's Role in Global Gold

Investments in precious metals such as gold, silver, platinum and palladium are in feverish pitch across China. No wonder, then, that the Chinese consumption of precious metals is dramatically going up, and up. China consumed 395.6 tonnes of gold in 2008 for jewelry and investment, reports the World Gold Council, or around 14% of global demand, up from 327.8 tonnes in 2007. In 2009, gold jewelry and investment demand in China is expected to reach 432 tonnes, compared with 422 tonnes from India. Thus, this year, China will effectively overthrow India as the No.1 gold consumer in the world.


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Gold Trend in China

Turnover on the Shanghai Gold Exchange (SGE) on a rolling 12-month basis is the highest it has been, at just under 900,000 oz. The People's Bank of China has also been going all out to mop up gold reserves. In April, China announced that the country had increased its gold reserves by 454 tonnes to 1,054 tonnes over the previous six years.

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As for China, thanks to encouraging policies established for the Gold Mining industry, the gold production in China has enjoyed continuous growth in recent years.