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China could boost gold prices

China has been included in the World Government Bond Index (WGBI). This could have far-reaching consequences, including with regard to the gold price.

China used to be inaccessible to investors. Now a globally accessible market has emerged. Investors have the opportunity to trade stocks and bonds. Bonds are now also appreciating. Because Chinese government bonds will be added to the WBGI. This is a milestone for Chinese bonds as investors look for investment opportunities in an interest-free world. They still exist in China on yuan.

This could have a negative impact on the USA, Europe, Japan and Great Britain, as they will lose weight in the index. There will be some redistribution to China as the WBGI is followed by a large passive group of investors. It is estimated that capital flows could amount to around $ 150 billion. This is because the WGBI is likely to be replicated by $ 1 trillion in passively managed funds. This should particularly affect the US dollar. At least this means that there is less demand for it. A loss of value is foreseeable.

This is all happening while the national debt due to Covid-19 is immense and continues to rise. Investors buy government debt at low returns. Once the corona crisis has been overcome, sales can be expected to increase.

It should therefore be better to bring gold into the safe haven. According to the experts, investors should use the temporary low point in the gold price for an aggressive entry. Even if the weakness of the gold price should drag on through the fall, a second part of the gold price rally is expected. So it wouldn’t be bad to have promising gold companies in your portfolio.

For example Mawson Gold or Treasury Metals. Mawson Gold – https://www.youtube.com/watch?v=WMZ9hqgBM5c&t=2s – Has projects in two mining-friendly areas. The Rompas-Rajapalot project in Finland with the raw materials gold and cobalt and the Sunday Creek project in Australia. Drilling is ongoing on both projects, and geophysical electromagnetic surveys are also being carried out in Finland.

Treasury Metals – https://www.youtube.com/watch?v=D7waWiqsO9o – will start production on its Goliath gold project in Ontario in the foreseeable future. Treasury Metals also owns the Goldlund project in Ontario, as well as other gold projects and a polymetallic project.

Current company information and press releases from Mawson Gold (- https://www.resource-capital.ch/de/unternehmen/mawson-gold-ltd/ -) and Treasury Metals (- https://www.resource-capital.ch/de/unternehmen/treasury-metals-inc/ -).

In accordance with Section 34 of the WpHG, I would like to point out that partners, authors and employees can hold shares in the respective companies addressed and that there is therefore a possible conflict of interest. No guarantee for the translation into German. Only the English version of these messages applies.

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