As it says in the article it apppears that China's gold production is not leaving the country . China's authorities along with the population is buying the whole lot , and it does'nt matter that China's official do not report on buiding up reserves , since they obviously do .

When the IMF 200 t. of gold came on the market last year and that some people among wich i was , expected China to fetch the whole lot , China's authorities made it clear they were not interested , stating they were buying gold localy and had been doing so fo some time as their increase gold reserve statement made previously confirmed .

The add campaign they ran encouraging China's population to buy gold also demonstrates their involvment in keeping local gold production inside the country adding up to the perception gold plays as a currency reserve or wealth preservation .

Since they decided to let the yuan float " freely " , warning at the same time that it might weaken against the US $ , hoping i believe , by doing so , that it would lower expectation about the rise of the yuan , it seems obvious that they would'nt come up shortly after with a statement about the increase of their gold reserve wich could could only increase the world's perception of a stonger yuan in the future .

It's in China's interest to keep the yuan as weak as possible in the near future to preserve it's exports as well as to protect rthe strenght of the US $ .

Sooner or later someone out there will evaluate the level of China's gold accumulation by adding up China's gold miners production and we will realise that after all wether it's the authorities or the population that buys it , in the end the gold does'nt leave the country , wich in my mind means the whole lot becomes the gold reserve of the country .

It may not be perceived as such by the markets but i would guess that we can assume that a large percentage of the gold is bought directly by China's central bank . Sooner or later this will boost the level of the yuan , or at least support it's relative strenght .

China's game to " play the market " regarding the yuan , consists mostly in keeping secret the basket of currencies along with their relative percentage to each other , that the yuan floats again .

If i were to make a case for the real value of the yuan i would consider evaluating the relative value of China's export to most major markets and assume those currencies are part of that basket of currencies the yuan floats again in relatively the same percentage each markets occupies in terms of China's exports , then i would add the gold reserves of China considering at least 50% of local production is bought every year by the governement as being a factor affecting the value even of the yuan even if only by a tiny amount .

I may be wrong in my fancies but i believe sooner or later the currency market will come to term with something similar to that as i believe it represents more accurately the real value of the yuan .

Somehow i also believe gold's real value will be affected by this type of calculation as it will show more clearly the role it plays among global currencies .