HONG KONG: China's central bank views gold prices as very high and will be wary of "bubble" assets, the Apple Daily reported yesterday, citing Hu Xiaolian, a deputy governor at the People's Bank of China.

The long-term benefits must be considered when managing the overall configuration of foreign-exchange reserves, the Hong Kong paper quoted Hu in Taipei as saying in response to a question about whether China's central bank would buy gold. A bank spokesman declined to comment on the report when contacted by Bloomberg News.

Gold advanced to a record for a third day, reaching $1,226.33 an ounce, as investors sought protection against the prospect of currency debasement and inflation. China increased its gold reserves by 76 percent to 1,054 metric tons since 2003, Xinhua News Agency reported in April.