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China Gold ETFs

Written By Brian Hicks

Posted February 1, 2013

The securities regulator for China has issued provisional guidance enabling operation of gold exchange-traded funds, which would be a first for the Chinese market. No set timeframe has been laid out.

However, per the People’s Daily, the China Securities Regulatory Commission did warn that much more research is needed to understand the impact of gold ETFs in a new market, and regulation would be adjusted accordingly so investors can be protected.

Gold ETFs in the global market, as of the end of July 2012, had a combined asset scale in excess of $140 billion. China’s increasing appetite for gold and gold consumption, and the lack of gold ETFs in the Chinese market, created favorable conditions for this move now, which should stimulate both the gold and the capital markets in that nation.

China is also the world’s largest gold producer and consumer (per the China Gold Commission), producing 360.96 tons in 2011. That same year, all gold transactions together accounted for around $395 billion.