TOKYO (MarketWatch) -- The precious-metals market took notice for all the right -- but not-so-obvious -- reasons when China announced last week that it ramped up its gold reserves by 76% in the last six years.
After all, the world's largest producer of gold, which also happens to be the world's most populous nation and third-largest economy, must have a good reason for its purchases -- and quite a few experts said the move solidifies gold's place as a monetary asset, and shows that it's destined for a brighter future.
"The important take-away is that China itself is absorbing the bulk (if not all) of the production of the world's largest producer of gold (also China) with the now confirmed intent of building reserve holdings," said Peter Grant, a senior metals analyst at USAGOLD-Centennial Precious Metals.
"That is very favorable for the longer-term outlook for gold," he said.
Last week, China announced that the amount of gold in its reserves has climbed to 1,054 tons from 600 tons in 2003. (more)
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