Hong Kong Launches Gold Clearing Firm with Shanghai Backing

TLDR

• Hong Kong signed an agreement with the Shanghai Gold Exchange to develop a centralized gold clearing system.
• The new company will be called the Hong Kong Precious Metals Central Clearing Co.
• Gold prices reached a new all-time high by crossing the $5,000 per ounce mark.
• Trial operations of the clearing company are expected to begin later this year after regulatory approval.
• The Shanghai Gold Exchange will assist with technical support, regulation drafting, and institutional approval.

Hong Kong has partnered with mainland China to launch a gold clearing company as gold prices crossed $5,000 per ounce. The Shanghai Gold Exchange offered full support, technical expertise, and regulatory assistance to establish a centralized precious metals platform in the city.

Hong Kong sets up gold clearing firm with mainland help

The Hong Kong government signed an agreement with the Shanghai Gold Exchange during the 2026 Asian Financial Forum. The deal outlines cooperation on infrastructure, rulemaking, and risk management for a new clearing company.

The entity, called the Hong Kong Precious Metals Central Clearing Co., will operate under international standards for transparency and efficiency. Trial operations are set to begin later in 2026, pending regulatory clearance.

A government statement confirmed the clearing platform will serve as the city’s core system for gold transactions. Hong Kong’s Secretary for Financial Services, Christopher Hui, will serve as chair. A Shanghai Gold Exchange representative will act as deputy chair.

He added that this development aligns with efforts to increase the use of China’s digital yuan offshore.

The Shanghai Gold Exchange, operating under the People’s Bank of China, will help draft rules and screen participating institutions. This cooperation is structured to boost Hong Kong’s global financial connections. The move strengthens China’s influence in international gold trading channels.

Gold hits record high as China expands reserves

Gold prices surged past $5,000 per ounce for the first time, continuing a 60% rally during 2025. Analysts attribute this climb to growing central bank purchases and economic uncertainties worldwide.

China remains the world’s largest consumer and producer of gold, holding 7.7% of global reserves by September 2025. Its official gold holdings reached 2,306 metric tons by the end of the year.

The country has purchased gold for 14 straight months, reinforcing its reserve strategy. Authorities also plan to build a new gold vault with over 2,000-ton capacity within three years. The facility will operate under Shanghai Gold Exchange’s warehousing system.

According to government data, this expansion supports China’s long-term physical supply goals. Officials emphasized compliance with global clearing standards. They also highlighted China’s growing role in pricing and physical storage of gold.

China increases gold imports as rare earth prices rise

Russia exported 25.3 tonnes of gold to China in 2025, marking an 800% year-on-year increase. December shipments reached a monthly high of 10 tonnes, worth $1.35 billion.

Russia ranked seventh among China’s gold suppliers, with Switzerland remaining the largest at $25.73 billion in exports. Canada followed with $11.06 billion, while South Africa exported $9.42 billion in gold.

Australia and Kyrgyzstan were also top suppliers, with $8.77 billion and $4.95 billion in exports, respectively. The gold trade between China and Russia hit record highs.

Meanwhile, Chinese rare-earth metal companies posted higher profits due to export restrictions and strong policy backing. From January to September 2025, 47 firms matched their full-year 2024 net profit totals.

Dysprosium prices in Europe reached $935 per kilogram in January due to supply concerns. China restricted exports of seven rare earths, including dysprosium, in April 2025.

In response, the US imposed new tariffs on Chinese goods, heightening trade tensions. Talks between both governments are ongoing. The situation continues to affect global supply chains.

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