Offshore yuan mulled for gold trading

As the world's largest gold producer and consumer, China is considering allowing offshore yuan to be used in gold trading in the China (Shanghai) Pilot Free Trade Zone (FTZ), Bloomberg reported on Wednesday citing sources.

Holders of offshore yuan account will be able to invest in three types of gold contracts, including a trading of 99.99 percent pure gold. The contracted physical gold can be delivered to a warehouse in the FTZ, according to a draft plan obtained by the Bloomberg.

Shanghai Gold Exchange hopes to establish an international platform for gold trading, as part of China's opening of its gold market to attract overseas institutions and individual investors, the plan said.

Total gold consumption reached 1,176.4 tons in China in 2013, up 41.3 percent from a year earlier, official data showed. The country has also been the world's top producer of gold for seven consecutive years, with output of 428.16 tons in 2013, up 6.23 percent year-on-year, according to China Gold Association.