Cazenove star analyst says China to raise gold reserves five-fold and boost gold price

From Arabian Money:

Gold and silver prices were advancing this morning in anticipation of a return from the Chinese New Year holiday, while Cazenove star analyst Robin Griffiths gave the Year of the Rabbit a poke with a prediction that China is looking to increase its gold holdings from two to 10 per cent of national reserves.

Extrapolated into the market that would mean China buying around 5,000 tons of gold, according to King World News. Mr Griffiths told the channel: ‘I think we’re moving into a world where Chinese and Indian authorities are going to be more dominant than they were in the past, and in their culture of course gold is real money. On top of that, particularly China already has more than enough dollars, it’s finding that a problem. It doesn’t want to crack the dollar, but it doesn’t want to go long of any more because of its trading activities.

‘For as long as interest rates are super low, there’s no negative cost of holding gold. There is a seasonality to gold and very often it doesn’t start running until the end of February…Once we get into March, I think we can expect it to start motoring higher again.’......read on