The price of gold in China is typically higher than global reference prices because the country is a net importer of the precious metal. Normally, local gold dealers need to offer a premium in order to attract material to the country. Starting in March 2020, the China gold premium switched to a discount. Unsurprisingly, market watchers have linked this change to the COVID-19 shock and its after-effects on global markets. There were a few driving forces behind this switch – and those illustrate how the Chinese gold market, and the Chinese economy at large, has some unique characteristics that makes it stand apart from other regions:
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