Nagy Farag discusses China's paper gold halt

Nagy Faragh, former advisor to the Minister of Supply, stated that China's decision to stop dealing with paper gold and to end contracts not tied to physical delivery will lead to increased demand for physical gold. Paper gold had been based on speculation rather than actual delivery of the metal. He explained that this decision, which began to be implemented on July 24, will result in the clearing of positions by both investors and speculators and will encourage trading in actual gold, thereby increasing buying pressure on the yellow metal. China has also halted leverage related to gold trading, which will shift the market toward physical contracts and lead to greater demand for real gold, especially given China’s role as a major source of global demand. Faragh believes that this move could create strong buying pressures on natural gold and lead to positive price movements in the long term, especially amid declining inflation and the absence of U.S. interest rate hikes. This reinforces gold's position as a safe haven investment.

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