THE Shanghai Gold Exchange is preparing to link gold markets in the city and Hong Kong to strengthen China's gold pricing power, the exchange told Shanghai Daily yesterday.
The disclosure came after Chan Sheung Chi, president of Hong Kong-based Chinese Gold & Silver Exchange Society, said the gold link — similar to the Shanghai-Hong Kong Stock Connect set up last year — will open as early as June.
The Shanghai gold bourse said it is working to set up the link and preparing to connect with the Hong Kong system, but it declined to give a timetable for the official launch.
The link will allow foreign investors to trade yuan-denominated gold contracts in Shanghai although details were not released.
The two parties signed an agreement last October to deepen cooperation via the gold international board set up in Shanghai's free trade zone.
The move enhances China's efforts to boost its sway on pricing of gold and internationalize the use of the yuan.
The Shanghai Gold Exchange has remained the world's largest exchange for physical gold for the eighth year, with transactions surging nearly 60 percent from a year ago to 185,000 tons last year.
The exchange and the World Gold Council have agreed to launch more products on the international board.
