gold thoughts (posted correctly this time), page-2

On the Dow wires this afternoon.Something to keep an eye on.


1332 [Dow Jones] Spot gold unmoved by report in Chinese newspaper that China's PBOC considering raising gold reserves by 4,000 tons from current 600 tons to diversify risks. Gold market discounts report as talk of central bank raising reserves surfaces every few months; given China's enormous foreign exchange reserves of $1.9056 trillion, PBOC would need to buy an enormous quantity of gold for diversification benefits, any signs of eventual concrete measures by Beijing to move into gold likely to drive it sharply higher. "Buying that amount of gold would be like going back to the gold standard, something to back the reserve with something tangible, like gold," says Investec head of trading Darren Heathcote. (EFB)