Monday, December 26, 2005

China faces dilemma on expanding gold reserve

China should increase its gold reserve from 600 tons to about 2,500 tons in a short term and to 3,000 tons in a long term to cope with the versatile exchange rate risks, said Teng Tai, an economist of China Galaxy Securities Company.
Too little gold reserve would pose threat not only to China, but also to the global monetary system, Teng said.
China should increase gold reserve to reduce the foreign exchanges risks and diversify its state reserve with various goods, like gold and oil, in the long run, said Shen Xiangrong, director of the Shanghai Gold Exchange, China's sole gold market... Read More

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