China Gives Thanks For Cheap Gold

Just a quick Thanksgiving morning update on China's gold imports, which continued at extraordinary levels in October. To put the 131 tonnes in perspective:

• Until recently there was an agreement in place that limited European central bank gold sales to 400 tonnes per year, because any more than that was seen as disruptive. Now China buys that much in a single quarter.

• The world's gold mines outside of China produced about 200 tonnes in October, which means China alone bought 65% of global gold production.

• Since the beginning of 2012, China has imported over 2,000 tonnes of gold, an amount equal to about 2/3 of the official reserves of Germany.

• China's domestic gold mines produce around 300 tonnes a year, all of which stays in-country. So China's total reported gold accumulation is 2,500 tonnes in just the past 22 months. And that does not include gold entering the country from other ports, which could be considerable.