The Central Bank Gold Agreement

The deal was updated three times and was eventually extended to 22 central banks, although the sell cap was lifted in 2014, three years after the last major gold sales by countries covered by the pact. Central banks bought 651 tons of gold last year worth nearly $US 30 billion, according to figures from the World Gold Council – most of them for half a century. The World Gold Council welcomes the decision of European central banks to agree on a new bank-gold agreement (CBGA). The agreement, the fourth of its kind, marks an ongoing commitment by some of the world`s largest holders of gold reserves to preserve the clarity and transparency that this agreement offers to gold market participants. It also reaffirms the importance of gold as an asset in the world`s currency reserves. Adrian Ash is Director of Research at BullionVault, the physical gold and silver market for private online investors. A former managing editor of London`s private investment advisory firm, he was the city`s correspondent for The Daily Reckoning from 2003 to 2008 and now writes regularly for many leading analytics sites, including Forbes, and is a regular guest on the BBC`s national and international radio and television news. Adrian`s views on the gold market were collected by the Financial Times and The London Economist magazine; CNBC, Bloomberg and in New York; The star in Germany; Il Sole 24 Ore from Italy and many other prestigious financial publications. In a remarkable presentation of the maturity of the gold market and the level of liquidity, prices did not move much after this announcement. Gold therefore has a well-established status of investment and safe investment. 20 years ago, central banks were net sellers of gold and liquidated about 500 tons a year. CBGA joined 15 banks in the euro area and limited the amount each signatory could sell each year on the market. This limit was essential to create a sense of stability in the gold markets.

At the time of signing, gold prices were around 200 $US. The signatories confirm that gold remains an important component of the world`s currency reserves, as it continues to offer advantages in asset diversification and none of them currently plan to sell significant amounts of gold. Central banks have become net buyers. The Bundesbank itself does not sell more small quantities of gold per year to the Ministry of Finance. The ministry uses the precious metal to mark commemorative coins. After extending the agreement by 5 years in 2014, the signatory banks agreed in 2019 not to renew the agreement, arguing that they had not sold large quantities of gold for some time. [7] Indeed, their sales had gone from the limit agreed in 2007 to almost zero in 2012 and remained very low thereafter. [8] By digitizing gold, you shift security costs to us. In addition, NNN tokens offer an investor incredible flexibility in the tokenized gold market.

That`s because you can trade with investors around the world without the baggage of logistics, and that`s undoubtedly the future of gold trading. To learn more about Novem, visit: “The deal was reached in response to concerns in the gold market, after the UK Department of Finance announced it was proposing to sell 58% of UK gold reserves through Bank of England auctions, with the prospect of significant sales by the Swiss National Bank and the possibility of current sales by Austria and the Netherlands. plus the IMF`s sales proposals. The British announcement, in particular, had strongly destabilized the market, since it was announced in advance, unlike most other European sales by central banks in recent years. Sales from countries like Belgium and the Netherlands have always been discreet and were announced after the event. Thus, the Washington/European agreement was perceived at least as a ceiling for European sales. » [2] 4. This agreement will be reviewed after five years.

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