Investors ploughing into gold is a sign of how terrible China's stock markets are right now

Investors are ploughing into the gold markets and the price is now up 1.10% at $1,071.80 per ounce, as of 9.10 a.m GMT.

This is a sure-fire sign of how terrified investors are about the state of China's stock markets and the country's growth prospects.

Gold is seen as a safe haven for cash. It doesn't pay a coupon like a bond and it doesn't pay a dividend from a stock but it does mean that you own ounces in a physical precious metal that you can hold onto.

Spikes in the gold market usually means investors are worried about the state of more volatile asset classes like stocks or bonds.

Over the last few months, China's dampened growth and wild swings in its equity markets caused major concern for investors. But today marked a new wave of worry, judging by the gold price:

Investors are generally worried about China's "real" economic growth. This morning, David Buik, an analyst at City broker Panmure Gordon told BBC Radio 4's Today programme that China's economic growth is a lot worse than the government is letting on. The official annual growth figure is at 7% however Buik "humbly suggests" that 3% growth is more accurate.

On Monday morning, China's blue-chip stocks tanked to their lowest level in four months in the wake of a disappointing manufacturing PMI report for December and further weakening in the Chinese yuan. The fall was only curtailed by a governmental mechanism that was installed that barred stocks from tumbling past 7%.

And this is all because of 2015's dramatic Chinese stock market volatility, where more than $5 trillion was erased from global stocks since China unexpectedly devalued its currency in August. When that happened, like today, Chinese investors rushed back into buying gold.

That very same month, the country's net gold imports from Hong Kong rose to a huge 97.2 tonnes from 59.3 tonnes in August, according to data obtained by Reuters from the Hong Kong Census and Statistics Department.

Here's the key quote from the report (emphasis ours):

Now that the stock market euphoria has been stamped out and reality has finally (and painfully) set in, the public and many casual retail investors have now lost faith in the stock market, and this has certainly boosted gold's attractiveness as an investment vehicle.

And it looks like history is repeating itself once again. If you thought 2016 would be more quiet than last year, you'd be wrong.