Rise of China’s Xinjiang as coal hub undercuts climate goals
Output has surged 22% this year, the fastest growth of any region in China.
Gold premiums in China, the top consumer of the metal, held near three-year highs this week amid short supply due to Beijing’s decision to restrict imports of the precious metal in an attempt to prevent capital from leaving the country.
As the Yuan dropped to lowest level since the financial crisis of 2008/09 and declined close to 6% so far this year, Beijing has been weighing measures to reduce outflows. One of them is placing tighter quotas on imports of the precious metal, which has pushed Chinese gold prices higher than international spot benchmark by as much as $46 per ounce, compared to normal levels of just $3 per ounce.
Just this week, bullion was sold in China at about $24 an ounce above the international spot benchmark.
Just this week, bullion was sold in China at about $24 an ounce above the international price. Premiums went as high as $30 last week, the most since January 2014, according to Reuters.
While imports quotas for banks that have a licence to import gold have been periodically revised down during quarterly assessments this year, they are now facing increasing challenges when trying to obtain approval to buy the metal abroad, FT.com reports (subs required).
Additionally, Chinese banks have had to deal with dollar quotas, some of which must be used when buying gold, the article says.
Gold prices were slightly stronger in early US trading Friday, on a short-covering rebound in the futures market and amid some perceived bargain-basement-buying in the cash market.
Spot gold was last up $4.10 an ounce at $1,175.70, putting the metal on track to rise for the first time in four sessions.
