HONG KONG (MarketWatch) - China's securities regulators have given the go ahead for a mutual fund to invest in foreign exchange-traded gold funds, potentially tapping interest among mainland China investors who face negative real interest rates on their bank deposits and want to hedge against inflation.

Lion Fund Management Co. said they received approval from the China Securities Regulatory Commission on Monday to proceed with the fund, the first of its kind for mainland China, according to a statement posted on the Beijing-based fund provider's website.

The fund has been granted permission to invest outside of China under the Qualified Domestic Institutional Investor (QDII), the fund managers said in the statement.

The fund will invest in gold-backed exchange-traded funds operated outside of China, though the fund provider's statement didn't specify which ETFs, or which markets, it was considering.

Hong Kong launched its own gold-ETF earlier this month, back by bullion held at a government-run depository at the city's international airport. See report on Hong Kong's first locally backed gold ETF.

David Fuller's view Some may see this as a contrary indicator but I am not among them. The first gold funds in an emerging superpower with the world's fastest growing middleclass, is a sign of the times. Gold is slowly but steadily being remonetised in the eyes of investors, as Fullermoney has pointed out over the last 10 years.