Shocking breakdown of China's foreign reserves is bullish for gold

I want to focus on the composition of China’s foreign reserves, explain why the liquid portion of the reserves may be much smaller than widely believed, and how that situation is bearish for RMB and bullish for gold.

According to Wikipedia:

“The foreign-exchange reserves of China are the People's Republic of China holdings of cash, bank deposits, bonds, and other financial assets denominated in currencies other than China's national currency (renminbi). At the end of January 2016, the foreign-exchange reserves of China stood at US$3.23 trillion. The management of foreign-exchange reserves is governed by the State Administration of Foreign Exchange and the People's Bank of China. The composition of foreign-exchange reserves is a state secret in China.“[1]

We managed to retrieve the following financial data from the China State Administration of Foreign Exchange (SAFE) website (www.safe.gov.cn):

[1] https://en.wikipedia.org/wiki/Foreign_exchange_reserves_of_China

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