In a bid to gain control over the pricing of the precious metal and enhance the nation’s sway in the global bullion market, China has now launched a Yuan denominated gold benchmark.
The first Chinese benchmark price was set at 256.92 Yuan a gram, the equivalent to $1,233.85 an ounce, on the Shanghai Gold Exchange for metal of 99.99 percent purity. The price, which is derived from a 1 kg-contract, will now be set twice a day.
China’s authorities will also be hoping for more international exposure and use of the Chinese currency through the linkage a report in the South China Morning Post detailed.
Backed by Banks
Eighteen institutions, including Chinese banks, jewelers, miners and the local units of Standard Chartered and Australia & New Zealand Banking Group (ANZ), will join the benchmark fixing.
China has now outpaced its Asian neighbour India as the largest consumer of gold. Growing incomes and decades of economic growth has help support purchases of bars, coins and jewelry.
