Russia and China have gotten much cozier over the last several months, and the two countries are reportedly working to develop a joint organization of trade in gold. This could have a significant impact on both the dollar and the price of gold.
The Chinese began laying the foundation two years ago.
In June 2015, the Chinese central bank announced its gold holdings had grown by 57% to about 1,658 tons. It was the first official update to China’s gold reserves since 2009. Since then, the Chinese have aggressively added to their holdings and taken other steps to increase their influence on the world’s economic stage.
That same year, a Chinese bank joined the twice-daily gold price fixing process run by the London Bullion Market Association (LBMA) for the first time. In May of last year, China’s largest bank purchased a huge London gold vault, further expanding its influence in the world gold market. Perhaps most significantly, China announced its largest gold investment fund ever in 2015. At the time, MarketWatch reported on the ramifications of the ‘Silk Road Gold Fund.’
This post was published at Schiffgold on APRIL 13, 2017.
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