The London-based WGC said it was confident that any fraud in China did not affect its overall estimate for gold demand.

The National Audit Office’s report was delivered by its chief, Liu Jiayi, at a National People’s Congress meeting June 24 and posted on the office’s website. The report covers a period beginning in 2012 and doesn’t specify an end date. It doesn’t identify companies or banks.

And 

Local lenders and foreign banks including Standard Chartered Plc, Citigroup Inc. and Standard Bank Group said they are reviewing potential fallout from any lending linked to Qingdao.

The Chinese agency that stockpiles strategic commodities is checking to ensure its copper purchases are free of collateral risks while the customs authorities issued new rules to help prevent goods being pledged multiple times as collateral, people with direct knowledge of these matters said previously.

Of the as much as $160 billion in transactions projected by Goldman, $80 billion may involve gold, $46 billion copper, $13.8 billion iron ore and $10.3 billion soybeans, according to a March 18 report.

 

Eoin Treacy's view

China’s gold imports represent a major source of demand for the global market. Therefore any threat to this driver is a potential headwind for gold prices. On the other hand, the fact that inventories are $80 billion less than previously anticipated means someone will need to buy in order to reach their desired holding. 

As we have already seen with the industrial metals, the initial panic over whether demand was overstated was quickly replaced by the realisation that consumers expecting delivery will still need the commodity which is at least a short-term tailwind for prices. Gold’s linkage with the industrial metals in the Chinese rehypothentication story offers a new perspective on gold’s sharp pullback in March and recent rebound.