The Cork Board

[investor15]

China to Start Gold Swaps Trading to Further Liberalize Market

By Bloomberg News - Nov 22, 2013

China, on track to overtake India as the world’s largest gold consumer this year, will start interbank swaps trading next week in a move to further open up the domestic precious metals market.

Trading will start Nov. 25 on the Shanghai-based China Foreign Exchange Trade System, according to a statement by the National Interbank Funding Center today. The Shanghai Gold Exchange, the country’s biggest spot gold bourse, will handle related settlement and delivery, said the statement.

“Swaps will be one more tool for banks to manage risks associated with bullion trading and will help broaden China’s gold market,” said Song Qing, fund manager at Lion Fund Management Co., China’s first asset manager to place money in foreign exchange-traded gold funds.

Bullion consumption in the world’s second-largest economy will surge 29 percent this year to a record 1,000 metric tons, according to the median of 13 estimates from analysts, traders and gold producers in China surveyed by Bloomberg News.

Bullion of 99.99 percent purity on the Shanghai Gold Exchange dropped 0.3 percent to trade at 245.66 yuan ($1,254.03 an ounce) at 2:30 p.m. local time. Gold for immediate delivery was at $1,245.82 an ounce.

To contact Bloomberg News staff for this story: Feiwen Rong in Beijing at [e-mail]

To contact the editor responsible for this story: Jarrett Banks at [e-mail]

http://www.bloomberg.com/news/2013-11-22/china-to-start-gold-swaps-trading-to-further-liberalize-market.html?