China should use more of its huge reserves of foreign currency to buy gold to support its goal of increasing the international role of the yuan currency, a senior government scientist said Saturday. Lianzhong Li, who heads the department’s Economic Bureau of the Communist Party’s policy research, said that Beijing should also encourage domestic companies to acquire energy assets abroad and of natural resources by using part of foreign reserves .
“We can also consider buying some more gold, because if we want to develop into an international currency RMB, we must have some importance in gold reserves,” said Li at a forum Beijing. The yuan is also known as the renminbi.
exchange reserves of China, the world’s largest, rose to 2.4471 trillion dollars at the end of March.
China disclosed in April that its official gold reserves rose to 1054 tonnes to 600 tonnes in 2003, confirming years of speculation that he had bought. [ID: nPEK307477]
But gold is still a small part of its huge foreign exchange reserves, which are mainly invested in assets denominated in dollars.
The U.S. dollar has threatened tumbling to weaken the purchasing power of China, fueling a debate that the world’s third largest economy would diversify into gold, oil and metals.
source:reuters
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