Gold prices shot up to higher than $ 1,200 per ounce on Wednesday. It was the first time this happened in nearly two weeks. The strong physical demand of gold lifted the price of the metal to a sixth day gain.
There was also supporting news that China is looking to expand its market for gold. China is the world's largest producer of gold and the second largest buyer of gold in the world behind India. In 2007 China (with 276 tonnes) overtook South Africa as the world's largest gold producer, the first time since 1905 that South Africa has not been the largest.
Chinese gold imports have been growing as the Central Bank began building up its gold reserves in recent years. The financial prosperity in China has also seen an increase in domestic gold investment. It is representative of a growing class of people in China who can now afford to buy gold.
