China restricts gold import as trade war heats up

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China restricts gold import as trade war heats up

As an attempt to curb outflow of dollars and to boost up its offshore Chinese Yuan, Beijing has been restricting imports of the precious metal gold since May following a pre-mature conclusion of trade talk with Washington, after it had been labelled as a backtracker and hit with a 25 per cent tariff hike on $200 billion worth of US exports, industry sources familiar with the subject-matter unveiled earlier this week.

Further inside the bid, the industry sources had been quoted saying on Wednesday, the 14th of August 2019, in terms of anonymity as they were not authorized to speak about the issue on public that the world’s second-largest economy had axed gold shipments worth of $15-$25 billion in comparison to last year.

Although, China has been the largest importer of gold, which used to inhale around 1,500 tons every year before further escalation of its trade war with the United States, steep restriction on gold imports came forth amid a tumultuous financial backdrop, when a heightened US tariff on Chinese goods had jolted the nations pace of growth to a nearly three decade low and forced its Central Bank to devalue its currency to its lowest level since 2008.

If truth is to be told, the largest exporter for United States, China’s economy grew at a tremendous pace over the last two years and rapidly the central Asian country had singed itself up among the wealthiest nations across the globe, which in effect surged Chinese demand for investment gold bars, coins and jewelries, but, a decaying trade relationship with Washington appeared to have forced Beijing to incline a harsh restriction on gold imports, analysts suggested.