MARKET REVIEW OF THE SGE IN JANUARY 2003

There were 20 trading days in January. Trading volume reached 16,270 kilograms with a total turnover of 1.556 billion yuan. Au99.95 traded 13,570 kilograms with a weighted average price of 95.76 yuan per gram, and 2,700 kilograms of Au99.99 was traded at the weighted average price of 95.08 yuan per gram.

The smooth operation and increasing turnover were due to the following causes. The People’ Bank of China adopted various supporting policies, which played a significant role in maintaining smooth operation. The taxation policies of gold trading formulated by the Ministry of Finance and the State Administration of Taxation corresponded to the real market, and their supportive and guiding functions to the market had been well embodied. The stable trade system backed by the China Foreign Exchange Trade System operated well, providing technical support to the gold trade. The organization of trade was very practical. The SGE formulated rules and regulations on trade, delivery, settlement, allocation and transportation complying with market performance to guarantee the members’interests. The members cooperated and coordinated well, and they gradually understood and grasped the market operational mode, and had identified with the operation and manipulation rules of the SGE.