Campaign For Increase In Chinese Gold Reserves Continues

This time, it's an article in the main PRC paper, the People's Daily. The proposal in question was written by an assistant professor of economics, not a government official, but it did make the main paper. The campaign evidently has some powerful backers. The professor, Jing Naiquan of Zhejiang University, made the point that the U.S. dollar's credibility was boosted by the U.S. government's large gold reserves. He was careful enough to point out that other major currencies have a major proportion of reserves in gold, but the suggestion is clear: if the PRC's renminbi is going to displace the greenback, it'd better be backed by a lot of gold.

That may be the reason why an academic is running with the ball. A high government official making the same suggestion could cause a flap in the U.S. for making that point.

More details are in this Reuters story.