SHANGHAI (Scrap Monster) : China’s Gold import from Hong Kong was reported to surge in February after more banks were permitted to import gold by the Govt. Amid the increasing demand for gold, the Chinese Govt. gave authorized permission for more banks to carry out import of precious metals because of which Gold import in the country climbed a record high last month and is expected to continue.

According to expert analyst report, net import of China in February reached a total of 109.2 mt when compared to the 83.6 mt in January a year ago. The estimate from Hong Kong Census and Statistics Department yesterday released the information that China’s export to Hong Kong was found to suffer a decline by 15.8 tons in February which stood at 19 tons in January. As per the data compiled by the Statistics Department in a separate statement, the bullion price is rising 9.1 % this year owing to the increasing consumption of gold in Asia. The factors such as the weakening market and the speculations of US recovery is said to be influencing the haven demand of Gold in Asian countries.

India which was the largest consumer of gold in the world was dragged down to the second position by China in 2014 after the stringent rules and regulations in India which declined its gold import considerably. China had issued gold importing licenses to Australia and New Zealand Banking Group Ltd., China Everbright Bank Co. and HSBC Holdings Plc in January which reflected largely in the country’s gold import ratio.

According to a partner at Shanghai-based Investment Management Company, Chinese imports and sales saw an upsurge during the Lunar New Year in 2014 when the demand for gold inventories increased at record-breaking levels. Gold import was also strengthened by demand from traders who used bullion purchases in trade financing deals to acquire immediate bank credit.

World Gold Council report shows that the Chinese consumption reached a record of 1,066 tons last year as the gold demand in the form of coins, bars and jewelry climbed 32 % in February. Gold holdings in ETF also mounted 6.9 % in February; indicating first time increase in fourteen months. Data from Hong Kong Govt. showed that the mainland Chinese buyers reached a total of 125 tons in February as compared to 102.6 tons in January.